Bangladesh’s securities regulator has finalized a plan to launch a derivatives market in the country’s capital market by 2028, beginning with index futures trading. The Bangladesh Securities and Exchange Commission approved a detailed implementation plan submitted by the Dhaka Stock Exchange at a commission meeting chaired by BSEC Chairman Masud Khan on Tuesday, according to a press release signed by Executive Director and spokesperson Abul Kalam.

Financial analysts said index futures would allow investors to hedge against movements in the overall market index and could provide protection for portfolios during market declines. They said the derivatives market would add modern investment instruments and create a route for better risk management in Bangladesh’s capital market.

The commission also approved a draft direct-listing rule that would allow eligible companies to list without an initial public offering, subject to offloading 10% to 20% of existing shareholders’ holdings. It set deadlines for remitting dividends to foreign investors after obtaining a double taxation avoidance certificate and eased approval requirements for certain share transfers involving Z-category companies.