Global Markets
Home›Global Markets›Emerging Markets›India’s top exchange sees options turnover hit a yearl…
India’s top exchange sees options turnover hit a yearly low on expiry day
Options premium turnover at the National Stock Exchange of India fell to about 670 billion rupees, the lowest since December, as stricter derivatives rules and a closing-auction system reshaped expiry trading strategies.
Options turnover at India’s largest stock exchange dropped to the lowest level this year on monthly expiry day, reflecting the impact of tighter trading rules and the introduction of a closing-auction mechanism in the country’s main equity derivatives market, according to LiveMint Markets citing bourse data.
Premium turnover on the National Stock Exchange of India Ltd. fell to about 670 billion rupees, the lowest since December. Cash equities trading volumes also declined to the lowest since November, with options and cash both reflecting the broader shift in expiry-day behavior.
The report links the decline to cumulative measures aimed at cooling India’s once-fast derivatives market, including fewer weekly expiries, larger contract sizes, and curbs on bank funding to proprietary trading firms. It also notes that the new closing-auction rollout earlier this month has changed how traders position for closing prices.
The shrinking options market is a challenge for NSE as it prepares for what would be India’s biggest initial share sale. Options generated about 100 billion rupees in transaction charges in the year ended March, accounting for 60% of revenue from operations, according to the exchange’s IPO filing.