NSE plans derivative contracts linked to European indices

“We hope to launch the European indices in the same lines as we did with S&P 500 and DJIA,” NSE senior vice-president R Sundararaman informed the media

New Delhi: The National Stock Exchange (NSE) is looking to launch derivative contracts linked to European indices, which will help domestic investors to have exposure to European equity market, reports PTI.

The bourse last month launched derivative contracts linked to the American equity indices—Dow Jones Industrial Average (DJIA) and S&P 500.

NSE senior vice-president R Sundararaman said the bourse is in discussions (with various players) to start derivative contracts on European indices.

“We hope to launch the European indices in the same lines as we did with S&P 500 and DJIA,” Mr Sundararaman told PTI.

Key European indices include the UK’s FTSE 100, Germany’s Dax and France’s CAC 40.

In July last year, NSE had entered into a pact with the London Stock Exchange (LSE) to evaluate options of cross-listing of their key indices on each other’s platforms.

As per the agreement, the two exchanges would explore the feasibility of FTSE Group licensing the FTSE 100 index to the NSE and the Indian bourse licensing its benchmark Nifty-50 to LSEG for trading purposes.

The derivative contracts on DJIA and S&P 500 were the first that such contracts on global indices were launched in India. The new contracts include futures on both the indices and options on the S&P 500.

Since their launch on 29th August, the derivative contracts on DJIA and S&P 500 have been seeing daily average of about 4,000 contracts, according to the NSE.

These rupee-denominated derivative contracts would help Indian investors to have exposure to the American equity market.

NSE is the fourth largest exchange in the world and also the second largest derivatives exchange in Asia.

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COMMENTS

Craig

5 years ago

MF Global had quite a few of the smartest men in the financial industry managing their assets. They also had access to the ultimate insider info, because their CEO, Jon Corzine, was a Federal Reserve Bankster insider. So, how could so many of the nation's brightest make such boneheaded decisions?

Once again I want to emphasize that for every loser in the financial derivatives market, there is an equal and opposite winner, making tons of cash.

Since 70% of the 1500 trillion dollar derivatives market is bets against interest rates going up or down, one would think that the former Chairman of Goldman Sachs would have some kind of clue on what the banksters were doing with interest rates. Some would argue that the loss of $40 billion dollars was a huge mistake. I would argue that there are no mistakes when it comes to the Satanic Psychopaths!

ONGC’s FPO postponed by 15 days

ONGC’s FPO was originally planned in the 2010-11 fiscal, but the launch was later deferred to 5th April as the company did not have adequate number of independent directors on its board to meet SEBI’s listing norms

New Delhi: The government has postponed the proposed Rs12,000-crore share sale in state-owned Oil and Natural Gas Corporation (ONGC) by 15 days to early October, reports PTI.

A group of ministers headed by finance minister Pranab Mukherjee was to meet on Friday to decide on the price band of ONGC’s follow-on-public (FPO) but the meeting has been postponed, sources said.

The Department of Disinvestment (DOD) sent out a letter saying the meeting has been postponed, but did not offer either a new date or the reason for the deferment.

The FPO was to open on 20th September and going by the 15-day postponement, it may now hit the market on 5th October.

Earlier this month, ONGC had filed a red herring prospectus (RHP) with the Securities and Exchange Board of India (SEBI) for the FPO.

The government plans to sell 5%, or 427.77 million shares, through the offer.

After the FPO, the government’s stake in ONGC will come down to 69.14% from the current 74.14%.

The FPO was originally planned in the 2010-11 fiscal, but the launch was later deferred to 5th April as the company did not have adequate number of independent directors on its board to meet SEBI’s listing norms.

It was then rescheduled for 5th July, but was again deferred due to adverse market conditions.

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BSE plans to introduce derivatives trading in NASDAQ 100 index

“We have applied for NASDAQ 100 index options and few other indices to begin with. Once the approval comes, we shall start trading in it,” BSE deputy CEO Ashishkumar Chauhan informed the media

Ahmedabad: Bombay Stock Exchange (BSE), the country’s oldest stock exchange, on Thursday said it plans to introduce trading in derivatives linked to NASDAQ, which will help domestic investors to get exposure to global equity markets.

“We have applied for NASDAQ 100 index options and few other indices to begin with. The talks are at an advanced stage. Once the approval comes, we shall start trading in it,” BSE deputy CEO Ashishkumar Chauhan told PTI.

Mr Chauhan was here to announce the launch of BSE’s Liquidity Enhancement Incentive Programme (LEIP), with focus on derivatives on the bellwether index Sensex and its underlying 30 stocks.

“The idea is to introduce various assets class to the investors and whatever gets attraction, we will work on that,” he said.

BSE has applied to market regulator Securities and Exchange Board of India (SEBI) seeking permission to start trading on options in NASDAQ 100 index and few other foreign indices.

He, however, said, “It is still not very clear what is the appetite for foreign asset class or indices in India.

Couple of years back, investment of $200,000 a year was allowed in foreign indices but not much interest was noticed.”

“India is a growth market, so once people have the facility to diversify to asset classes to whom they are not directly connected, they would participate, especially when its available on a local exchange,” Mr Chauhan said.

The National Stock Exchange (NSE) had last month launched derivative contracts linked to American equity indices—Dow Jones Industrial Average (DJIA) and S&P 500. It was the first such contract on global indices to be launched in India.

Meanwhile, speaking about the LEIP, Anil Shah, a member of the BSE governing board said, “The scheme is expected to increase derivative turnover of the exchange from existing around Rs100 crore per day to over Rs35,000 crore per day, within 15 days of its launch in October.”

“We expect at least 25% to 30% participation in this scheme from Gujarat,” Mr Shah said.

“Over 100 members have shown commitment so far to participate in this scheme, and another 400 are expected to join gradually as we move ahead,” he added.

BSE will pay incentives worth Rs5 crore in the first phase of the two-tier series of LEIPS-I (Beta) to the participating members.

In the second phase of the programme (or series LEIPS-II), incentives to the tune of Rs102 crore (Rs17 crore on a monthly basis) would be paid out to all participating members.

The LEIPS-I (Beta) will run from 28 September to 25 October 2011 and LEIPS-II will commence on 26th October and run for six months.

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