Intraday Trading in Nepal: SEBON Concept Paper 2083 & NEPSE Trading

Sep 24, 2026
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Intraday Trading in Nepal: SEBON Publishes Concept Paper for Phased Implementation

Nepal’s capital market regulator has published a concept paper on the implementation of Intraday Trading in Nepal, aiming to improve market liquidity, strengthen the price discovery process, and support the development of modern capital market infrastructure.

The Securities Board of Nepal (SEBON) has prepared the Concept Paper on Implementation of Intraday Trading of Securities in Nepal, 2083 as part of the preparatory process for introducing intraday trading through appropriate legal, regulatory, technological, and risk-management frameworks.

The concept paper follows the Capital Market Strengthening and Recovery Action Plan, 2083, issued by Nepal’s Ministry of Finance on 29 Bhadra 2083, as well as SEBON's annual policies concerning margin lending and intraday trading.

For investors interested in understanding how these proposed market mechanisms could work, learning the fundamentals of stock market trading in Nepal, technical analysis, risk management, and NEPSE market structure can provide an important foundation.

What Is Intraday Trading?

Intraday trading refers to buying and selling securities within the same trading day. Unlike conventional investing, where an investor may hold shares for days, months, or years, intraday trading focuses on completing a trading position within the trading session.

If implemented in Nepal, intraday trading could introduce a different trading mechanism for eligible securities while also requiring stronger systems for:

Real-time risk management
Broker-level monitoring
Margin and RMS systems
Market surveillance
Investor risk disclosure
Trading technology
Settlement and clearing
Securities lending and borrowing
Short-selling infrastructure

The proposed framework emphasizes that intraday trading should not simply be introduced immediately across the entire market. Instead, it proposes a phased and risk-based approach.

Why Is SEBON Considering Intraday Trading in Nepal?

The proposed framework identifies several objectives behind the development of intraday trading.

1. Improve Market Liquidity

Intraday trading may increase the frequency of transactions in eligible securities and potentially contribute to greater market liquidity.

2. Strengthen Price Discovery

More active trading can contribute to the process through which market participants determine the prices of securities based on available information and buying and selling interest.

3. Modernize Nepal's Capital Market Infrastructure

The proposed framework places significant emphasis on technology, real-time monitoring, risk management, and market surveillance.

4. Develop New Trading Opportunities

Intraday trading could provide investors with another mechanism for participating in the secondary market, subject to eligibility requirements and applicable regulations.

However, intraday trading also involves substantial risks. Greater trading frequency does not automatically mean higher returns. Investors need to understand leverage, volatility, transaction costs, liquidity risk, and risk-management principles before participating.

Phased Implementation of Intraday Trading

One of the key features of the concept paper is its proposal for phased implementation.

Rather than introducing all forms of intraday trading immediately, the framework proposes starting with a relatively limited model and expanding it after evaluating market experience and associated risks.

Initially, only selected securities may be eligible.

The securities considered for intraday trading could be those that:

Trade regularly
Have sufficient liquidity
Have comparatively lower market-abuse risks
Meet prescribed eligibility criteria
Can be effectively monitored through available market infrastructure

After the testing and pilot phases, the scope could potentially be expanded based on experience and risk assessment.

Buy First, Sell Later: Proposed Initial Model

The concept paper proposes initially implementing a “Buy First, Sell Later” model.

Under this approach, an investor would first purchase the eligible security and subsequently sell it within the permitted intraday trading framework.

This differs from a “Sell First, Buy Later” model, where an investor sells a security before purchasing it back.

The proposal suggests that the latter model should be considered only after adequate infrastructure for Securities Lending and Borrowing (SLB) and Covered Short Selling has been developed.

This distinction is important because short-selling requires a framework that ensures securities can be delivered and positions can be appropriately managed.

Sell First, Buy Later and Short-Selling Infrastructure

The proposed framework does not suggest immediately introducing unrestricted sell-first intraday transactions.

Instead, the concept paper links the implementation of “Sell First, Buy Later” to the development of adequate infrastructure for:

Securities Lending and Borrowing
Covered Short Selling
Risk management
Settlement
Position monitoring
Broker-level controls
Market surveillance

This approach is designed to ensure that additional trading mechanisms are introduced only when the necessary infrastructure and risk controls are sufficiently developed.

Investor Protection as the Primary Priority

Investor protection is identified as a central principle of the proposed intraday trading framework.

The concept paper emphasizes:

Risk-based regulation + phased implementation + real-time technology + surveillance + transparency

This means the regulatory framework would need to address not only how investors place intraday orders but also how brokers, exchanges, clearing institutions, and regulators manage the risks associated with those transactions.

Important areas include:

Risk Disclosure

Investors would need appropriate information about the risks associated with intraday trading.

Margin and Risk Management

Broker-level margin and Risk Management Systems (RMS) would play an important role in controlling exposure.

Real-Time Monitoring

Technology-based monitoring would be necessary to identify unusual trading activities and manage risks during the trading session.

Market Surveillance

Surveillance mechanisms would be required to monitor potential market manipulation and other forms of market abuse.

Legal and Regulatory Preparation

Before intraday trading becomes fully operational, the proposed framework calls for preparation in several areas.

These include:

Necessary legal provisions
Regulatory requirements
Eligible securities criteria
Eligible investor criteria
Broker Standard Operating Procedures (SOP)
Risk disclosures
Margin and RMS requirements
Market surveillance
Technology infrastructure
Testing procedures
Pilot implementation
Readiness assessment

This indicates that the introduction of intraday trading is being considered as a process rather than a single regulatory announcement.

Testing and Pilot Phase

The proposed approach includes testing and pilot implementation before full-scale operation.

This can allow regulators and market institutions to evaluate:

System performance
Broker readiness
Investor understanding
Risk-management effectiveness
Settlement processes
Market surveillance
Technology capacity
Operational challenges

The experience obtained during the pilot phase could then be used to identify improvements before expanding the system.

Role of SEBON, NEPSE, CDSC and Stock Brokers

The concept paper has been prepared following discussions within a coordination and facilitation committee formed for the implementation of the Secondary Market Reform Plan.

Representatives from key capital market institutions participated in the process, including:

Securities Board of Nepal (SEBON)
Nepal Stock Exchange Limited (NEPSE)
CDS and Clearing Limited (CDSC)
Stock Brokers Association of Nepal

Coordination among these institutions will be important because intraday trading requires interconnected trading, clearing, settlement, risk-management, and surveillance systems.

What Could Intraday Trading Mean for NEPSE Investors?

If implemented, intraday trading could introduce a new dimension to the Nepal Stock Exchange (NEPSE).

Investors may eventually have access to trading strategies that differ from traditional buy-and-hold investing. However, intraday trading also requires a stronger understanding of market movements and risk.

Investors should understand:

Technical analysis
Support and resistance
Volume analysis
Market trends
Risk-reward ratios
Stop-loss concepts
Position sizing
Trading psychology
Transaction costs
Liquidity
Margin requirements

For beginners, learning these concepts through structured stock market training in Nepal can be useful before attempting active trading.

Intraday Trading Is Not the Same as Investing

A major distinction investors should understand is the difference between intraday trading and long-term investing.

Long-term investing generally focuses on factors such as:

Company earnings
Business growth
Valuation
Dividend potential
Balance-sheet strength
Management
Industry outlook

Intraday trading, on the other hand, typically places greater emphasis on:

Price movement
Volume
Technical indicators
Market momentum
Short-term support and resistance
Entry and exit levels
Risk management

Neither approach eliminates market risk. Investors should select strategies based on their knowledge, financial objectives, risk tolerance, and understanding of the market.

Why Stock Market Education Matters Before Intraday Trading

The potential introduction of intraday trading makes stock market education in Nepal increasingly relevant.

Understanding how the NEPSE market operates, how orders are executed, how technical indicators work, and how risk should be managed can help investors make more informed decisions.

Sarbaguna provides stock market classes and trading education in Nepal, covering areas such as fundamental analysis, technical analysis, market structure, trading strategies, portfolio management, and practical NEPSE analysis.

Learn more about Share Market Training in Nepal and build a stronger foundation before participating in increasingly sophisticated market mechanisms.

Final Thoughts

SEBON's concept paper represents a proposed framework for introducing Intraday Trading in Nepal through a controlled and phased process.

The proposal focuses on investor protection, risk-based regulation, eligible securities, technology infrastructure, broker-level risk management, surveillance, and market transparency.

The initial Buy First, Sell Later model could be followed by broader mechanisms, including Sell First, Buy Later, after sufficient Securities Lending and Borrowing and Covered Short Selling infrastructure is developed.

Importantly, the publication of a concept paper does not mean that every proposed mechanism is already fully operational. Further regulatory, legal, technological, testing, and implementation steps are required.

For NEPSE investors, the key takeaway is simple: understanding the market and managing risk will become even more important as Nepal's capital market develops new trading mechanisms.

Learn Stock Market Trading with Sarbaguna

If you want to learn NEPSE analysis, technical analysis, fundamental analysis, trading strategies, intraday trading concepts, risk management, and practical stock market skills, explore Sarbaguna Stock Market Training Nepal.

For stock market classes in Kathmandu, Patan and Bhaktapur, contact:

Deep Thapa
Call / WhatsApp: 9849290806

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