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Informist, Saturday, Nov. 30, 2024

 

By Rajesh Gajra

 

MUMBAI – The expiry day of all monthly futures and contracts on five equity indices will be the last Thursday of expiry month with effect from Jan 2, the National Stock Exchange of India said in a circular late Friday. Nifty 50 index's monthly derivatives contracts already expire on last Thursday of expiry month and this expiry day will stay unchanged. But four other indices-Nifty Bank, Nifty Financial Services, Nifty Midcap Select, and Nifty Next 50--on which monthly derivatives contracts are available will each see a change in their expiry days to last Thursday of expiry month from different days.

 

Nifty Bank index's monthly derivatives contracts currently expire on last Wednesday of expiry month, while that of Nifty Financial Services index expire on last Tuesday, Nifty Midcap Select index expire on last Monday, and Nifty Next 50 index expire on last Friday. NSE's announcement came a day after BSE said it was moving the expiry day of its weekly derivatives on Sensex to Tuesday of every week from Friday of every week with effect from Jan 1.

 

The monthly Sensex derivatives contracts too will see the expiry day change to last Tuesday of expiry month from last Friday of expiry month, the exchange said. BSE also moved the expiry day of monthly derivatives contracts on Bankex and Sensex 50 indices to the last Tuesday of expiry month. Currently, Bankex index's monthly derivatives contracts expire on the last Monday of expiry month while that on Sensex 50 index expire on the last Thursday of expiry month.

 

The two exchanges did not specify the reasons behind having a common expiry day for their respective monthly index derivatives contracts. Informist had reported exclusively on Nov 6 that the Securities and Exchange board of India had urged the stock exchanges to shift the expiry day of their respective monthly derivatives contracts to a common day.

 

The SEBI, which issued extensive measures to curb trading volume in index options including restricting weekly contracts to only benchmark index per stock exchange, did not want exchanges to offer different expiry days in their monthly derivatives contracts as it would lead to higher trading volume on the expiry day. NSE's announcement Friday and BSE's announcement Thursday appear to be an outcome of the talks between SEBI and stock exchanges.  End

 

Reported by Rajesh Gajra

Edited by Deepshikha Bhardwaj

 

 

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