Sebi allows NSE, BSE to trade in cross currencies derivatives
MUMBAI: Capital market regulator the Securities and Exchange Board of India has written a letter to the National Stock Exchange and BSE allowing them three pair of new currencies with an extended trading time in the derivatives market, two people familiar with the matter said.
The move will help increase liquidity in the market at a time when domestic exchanges are seen vying with overseas exchanges like Singapore Stock Exchange.
“We have received permission from SEBI, which will expand scope for currency futures and options market,” one of the exchange officials cited above told ET.
Individuals and institutions can now trade in Euro-dollar, Pound sterling-dollar, dollar-Japanese yen in the exchanged trade futures and options. The trade timing is extended to 7.30PM unlike 5PM now.
Currency futures are normally used either to cover overseas exposure or trading gains.
The cross currency futures is now available in various pairs including euro-rupee, sterling-rupee, yen-rupee and dollar-rupee. Now, the first three pairs are allowed to be traded in options as well.