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NSE to stop issuing mini derivative contracts from Feb 1

Last Updated: Wednesday, November 21, 2012 - 22:35

Mumbai: Leading bourse National Stock Exchange (NSE) Wednesday said it will not issue mini derivative contracts on its key benchmark index, S&P CNX Nifty, from February as per market regulator's SEBI directives.

In a circular, NSE said it would not issue any fresh mini futures or options contracts from February 1, 2013.

However, the existing unexpired contracts till January 2013 would be traded till expiry and new strikes can also be introduced in the existing contract months.

Securities and Exchange Board of India (SEBI) had on Tuesday asked stock exchanges -- BSE and NSE -- to discontinue such contracts on their respective indices Sensex and Nifty with a minimum size of Rs 1 lakh.

The move was aimed to discourage small investors from getting attracted to these instruments.

Derivatives are contracts between two or more entities and their value depends on underlying assets such as stocks.

"Mini derivative (Futures & Options) contracts on S&P CNX Nifty Index (MINIFTY) for new expiry months shall not be available for trading on expiry of existing contract months ...No contracts shall be available for trading in MINIFTY with effect from February 1, 2013," the exchange said.

"However, the existing unexpired contracts of expiry months November 2012, December 2012 and January 2013 would continue to be available for trading till their respective expiry and new strikes would also be introduced in the existing contract months," it added.

The regulator had introduced mini derivatives in December 2007.


First Published: Wednesday, November 21, 2012 - 22:35
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