Singapore Exchange has obtained licensing rights and expects to provide S&P CNX Nifty Index (Nifty) options and related products.
Licensing rights from India Index Services & Products Limited (IISL) will allow SGX to offer the product range including derivative contracts on the CNX Nifty Junior, CNX 100 and CNX Midcap indices. Subject to regulatory approvals, the products may be added amidst rise in the trading of India-related products on SGX.
Market participants are expected to gain enhanced means for risk management and increased trading opportunities with these new India-based products. Total trading volume in 2009 for the SGX S&P CNX Nifty Futures was 7.1 million contracts, or a daily average of 29,524 contracts.
SGX CEO Mr Magnus Bocker said, "We would like to express our appreciation to our customers for their support of our current suite of India-linked products. As we continue to find ways to meet customers' growing interest in the Indian market through our different partnerships, we are very excited to deepen our relationship with IISL with this planned expansion of our suite of Indian equity derivatives. This will complement our current offerings and bolster SGX's position as a one-stop gateway for international market participants to manage their Indian investment, trading and hedging needs."
Meanwhile Mr Ravi Narain, Chairman of the Board of Directors of IISL and Managing Director & CEO of the National Stock Exchange of India Limited, said, "The total trading volume of Nifty-linked Futures on NSE in 2009 was 167 million contracts, representing a daily average of 687,000 contracts and the trading volume of Nifty-linked Options on NSE in 2009 was 321 million contracts representing a daily average of 1,321,000 contracts Index derivatives based on Nifty have been very successful both in India and in Singapore over the last few years."
National Stock Exchange of India Limited and Singapore Exchange have also signed a Memorandum of Understanding to cooperate in the development of a market for India-linked products.
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