Eurex, BSE to launch F&O on Sensex from October 4

Announcing this here, BSE, on Wednesday, said the new listings are latest product offering targeting the Asia-Pacific region.  The new contracts will be denominated in US dollars and settled in cash, while the futures will have expiry dates of the three nearest months, and the following March, June, September and December.

Two market-making schemes will be in effect until the end of December 2011.  One is to support liquidity during the overlap of Indian and European trading hours and the other for European market hours only. The expiration dates of the options will be in the three nearest calendar months, the next three quarters and two next semi-annual expiries.

In this context, Eurex Executive Board Member Peter Reitz said “we are committed to offering our members diverse and truly global product offering across key geographies and asset classes. The Sensex is the most widely recognized gauge for the Indian market and complements our suite of leading equity index derivatives.” 

By introducing futures and options on this prominent benchmark, Reitz said the Eurex will also advance its efforts in the Asia-Pacific region by creating trading opportunities for customers seeking access to this fast-growing emerging economy.

BSE Managing Director & CEO Madhu Kannan said the tie up with Eurex will help BSE to develop a broader international investor base focused on the Sensex.  “The Sensex will now be trading during a larger portion of the global trading day, which will increase its appeal and value.  Moreover, we see the growth of overseas liquidity in the Sensex as helping us to broaden and deepen the market for Sensex products within India,” said Kannan.

It may be noted that the Sensex – tracking the daily performance of 30 of the largest and most actively traded firms listed on BSE – is a value-weighted index that represents almost half of the float-adjusted market capitalization of all stocks traded on BSE.

BSE is a corporatised and demutualised entity with a broad shareholder-base and also includes two leading global exchanges, Deutsche Börse and Singapore Exchange as strategic partners. It provides an efficient and transparent market for trading in equity, debt instruments and derivatives.

The international derivatives exchange Eurex, jointly operated by Deutsche Börse AG and SIX Swiss Exchange, is considered the world’s largest equity options exchange. Eurex is home to the Euro zone interest rate and equity index benchmark derivatives.  Its global liquidity network comprises around 410 direct exchange members in 25 countries worldwide.