Detailed Explanation:

Correct Answer: ✅ Option 1 (I and II only)

India has witnessed a remarkable surge in stock market participation and derivatives trading in recent years. At the same time, investor protection and market regulation are actively handled by Securities and Exchange Board of India.

✅ Statement I is Correct: India accounts for a very large share of global equity options trading volume, making it one of the world's most active derivatives markets.

✅ Statement II is Correct: India's stock market capitalization grew rapidly and, during 2024, briefly surpassed that of Hong Kong, becoming one of the world's largest stock markets.

❌ Statement III is Incorrect: India has a dedicated regulator, Securities and Exchange Board of India>, which:

• Warns investors about the risks of derivatives and options trading.

• Regulates investment advisers and research analysts.

• Takes action against unregistered financial advisors and fraudulent entities.

Short Notes: India's Equity Options Market

• India is among the world's largest markets for equity derivatives trading.

• Equity options provide the right, but not the obligation, to buy or sell an asset.

• High trading volumes do not necessarily indicate high profitability for retail investors.

• SEBI regulates stock exchanges, brokers, and investment advisers.

• The National Stock Exchange and Bombay Stock Exchange are India's major stock exchanges.

• India became one of the world's top stock markets by market capitalization in recent years.

• SEBI frequently issues advisories regarding the risks of speculative options trading.