In line with a recent SEBI circular aimed at strengthening the equity index derivatives framework, the Bombay Stock Exchange (BSE) has announced the discontinuation of weekly derivatives contracts on the SENSEX 50 and BANKEX indices. This decision is intended to increase investor protection and market stability.
Key Details of the Notice
According to the notice issued by BSE on October 3, 2024, the changes are part of SEBI’s measures to reinforce the trading framework for equity index derivatives. Here’s what will change:
- SENSEX 50 Weekly Derivatives Contracts:
- All weekly index derivatives contracts on the SENSEX 50 will be discontinued from November 14, 2024, at the end of the day.
- New weekly contracts will not be generated after this date.
- Any existing unexpired contracts will continue to trade until their respective expiry dates.
- BANKEX Weekly Derivatives Contracts:
- Similarly, all weekly index derivatives contracts on BANKEX will be discontinued starting from November 18, 2024, at the end of the day.
- No new weekly contracts will be introduced post the discontinuation.
- All currently active contracts will remain in effect until their respective expiry.
Clarifications and Further Information
Trading members are advised to refer to SEBI Circular SEBI/HO/MRD/TPD-1/P/CIR/2024/132 dated October 1, 2024, for the full details of the regulatory changes. Should there be any questions or a need for clarification, BSE has directed trading members to contact their Helpdesk or respective relationship managers.
These changes reflect an ongoing effort to enhance investor safety and ensure market stability, with a shift away from shorter-duration weekly contracts in favor of more standardized options.
This update is critical for traders who are currently dealing in weekly derivatives contracts on either SENSEX 50 or BANKEX. The trading community should prepare for the transition and adjust their trading strategies accordingly.
