MARIF: A Multi-Agent Regime Intelligence Framework for Adaptive Options Strategy Selection in Indian Derivatives Markets
TL;DR
The proposed Multi-Agent Regime Intelligence Framework is an interpretable, extensible architecture unifying signal domains that are normally treated separately in Indian derivatives literature, rather than a claim of validated trading performance.
Abstract
Retail participants in Indian index options markets typically apply a small set of habitual strategies regardless of the prevailing market environment, which increases the likelihood of mismatched risk exposure. This paper proposes the Multi-Agent Regime Intelligence Framework (MARIF), a conceptual, rule-based multi-agent architecture that classifies the prevailing market regime for NIFTY 50 and BANKNIFTY by combining five heterogeneous information sources: price-based technical indicators, India VIX volatility levels, NSE option-chain analytics (Open Interest and Put-Call Ratio), Market-Wide Position Limit (MWPL) institutional concentration data, and sentiment extracted from financial news headlines. Five specialised agents produce independent signals that a Coordinator Agent fuses through an explicit weighted-voting rule into a single regime label and an associated options-strategy recommendation, such as a Bull Call Spread, Bear Put Spread, Iron Condor, or Long Straddle. This paper presents the architecture, its grounding in established option-pricing theory, an explicit specification of the fusion rule, and a worked illustrative walk-through of how the framework processes a representative set of inputs. No live backtesting has yet been performed; the framework is presented at the design and specification stage, and a concrete empirical validation plan is proposed as immediate future work. The contribution is an interpretable, extensible architecture unifying signal domains that are normally treated separately in Indian derivatives literature, rather than a claim of validated trading performance.