BSE reduces lot size, shifts expiry of derivatives contracts to Friday
1 min read 28 Mar 2023, 02:50 PM ISTIf the expiry day falls on a trading holiday, the expiry day will be the previous trading day
PremiumIn a move to boost derivative trading in Sensex and Bankex indices, stock exchange BSE has tweaked the lot size and expiry day of monthly, weekly and long-dated futures and options contracts. This will come into effect from 15 May this year, BSE said in a statement.
The stock exchange said that the lot size for futures and options contracts of Sensex has been reduced to 10 from 15 earlier. For the Bankex index, the lot size for futures and options contracts has been changed to 15 instead of the existing 20.
It has also changed the expiration day of its monthly, weekly and long-dated futures and options contracts to Fridays, from Thursdays at present.
If the expiry day falls on a trading holiday, the expiry day will be the previous trading day.
Currently, the derivatives contracts (futures and options) expire on Thursdays, while the monthly contracts are valid till the end of session on the last Thursday of each month.
A derivative contract is a financial instrument whose value is derived from an underlying asset. The price of an equity derivative contract, for example, moves in tandem with the underlying stock or equity index.
“All the existing contracts of S&P BSE Sensex (weekly, monthly and long dated) and S&P BSE Bankex (weekly and monthly) with expiry day as Thursday will expire on 12 May, 2023 end of day and will not be available for trading w.e.f 15 May, 2023," the BSE said.
“New contracts of S&P BSE Sensex (weekly, monthly and long dated) and S&P BSE Bankex (weekly and monthly) with Friday expiry and aforementioned revised specifications will be generated on 12 May, 2023 end of day and will be available for trading w.e.f 15 May, 2023," the statement read.
It further said that all other contract specifications of futures and options contracts of S&P BSE Sensex and S&P BSE Bankex other than changes mentioned above, shall continue to remain the same.
