02 April 2024
Facing steadily creeping competition from rival BSE, the National Stock Exchange (NSE), India’s market-leading stock exchange, has halved the lot size of its Nifty futures and options contracts to 25 shares with effect from 26 April across weekly, monthly, quarterly and half-yearly expiries.
The move has made its contracts significantly cheaper than the Sensex options contracts, which picked up steam from May last year. In a circular on Tuesday, NSE said that for the purpose of the computation of contract value, the average closing price of the underlying index has been taken for a one-month period of March 2024.
The average closing price of Nifty in March was 22,187.31 and that of Sensex was 73,180.67. At a lot size of 50, the Nifty contract value works out to ₹11.09 lakh. At a lot size of 25, it is ₹5.5 lakh. At the Sensex average closing price, the contract value (10 shares) is ₹7.3 lakh.
“The change has been effected as competition from rival BSE is increasing gradually," said Chandan Taparia, SVP (head – technical & derivatives research) at Motilal Oswal Financial Services. “The decreased lot size of Nifty could attract more retail participation."
Facing steadily creeping competition from rival BSE, the National Stock Exchange (NSE), India’s market-leading stock exchange, has halved the lot size of its Nifty futures and options contracts to 25 shares with effect from 26 April across weekly, monthly, quarterly and half-yearly expiries.
The move has made its contracts significantly cheaper than the Sensex options contracts, which picked up steam from May last year. In a circular on Tuesday, NSE said that for the purpose of the computation of contract value, the average closing price of the underlying index has been taken for a one-month period of March 2024.
The average closing price of Nifty in March was 22,187.31 and that of Sensex was 73,180.67. At a lot size of 50, the Nifty contract value works out to ₹11.09 lakh. At a lot size of 25, it is ₹5.5 lakh. At the Sensex average closing price, the contract value (10 shares) is ₹7.3 lakh.
“The change has been effected as competition from rival BSE is increasing gradually," said Chandan Taparia, SVP (head – technical & derivatives research) at Motilal Oswal Financial Services. “The decreased lot size of Nifty could attract more retail participation."
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