Markets regulator from Securities and Exchange Board of India (Sebi) has given approval to National Stock Exchange of India Limited (NSE) to launch weekly options on Nifty 50 index. NSE is currently evaluating readiness of market participants for the product launch and is expected to announce launch date shortly.
According to a press statement, Nifty 50 weekly options will have seven consecutive weekly expiry contracts excluding the week where monthly contracts expire). “On expiry of a weekly contract, exchange shall introduce next weekly contract on rolling basis. The existing three monthly option contracts, three quarterly and eight semi-annual option contracts will also continue to be available,” NSE said.
The contracts shall expire on Thursday of every week. In case the Thursday is a trading holiday, the previous trading day shall be the expiry or last trading day. The strike interval for the weekly options will remain the same as monthly contracts.
Vikram Limaye, managing director and CEO of NSE, said, “The weekly options on Nifty 50 index provides an additional hedging tool for market participants to manage the portfolio risk more effectively.”
Recently, NSE has launched weekly options in the currency derivatives segment on the USD-INR currency pair. In 2016, NSE had launched weekly options in the equity derivatives segment on the Nifty Bank index.