NATIONAL STOCK EXCHANGE OF INDIA LIMITED

 

Futures and Options Segment

 

CIRCULAR

 

Circular No.: NSE/F&O/96/2005                                             Date: March 17, 2005

Download No. NSE/FAOP/5943

 

 

Dear Members,

 

Subject : Revision of Market Lot of Derivative Contracts

 

It has been observed that over a period of time, there has been variation in the prices of the underlying stocks/indices. As a result the contract size/value of most derivative contract have far exceeded the prescribed minimum value of Rs. 2 lakhs and in some cases the contract size/value has fallen below the minimum prescribed value of Rs. 2 lakhs. The minimum value of the contract as on particular day is determined by multiplying the market lot by the closing price of the underlying security on that day.

 

In view of the above and in pursuance to SEBI circular no. SEBI/DNPD/CIR-20/2004/02/23 dated February 23, 2004, the Exchange has decided that:

 

  • For derivative contracts which have a contract size/value as on March 16, 2005 of more than Rs. 4 lakhs, the revised market lot size shall be arrived at by dividing the existing market lot by 2.
  • For derivative contracts which have a contract size/value as on March 16, 2005 of less than Rs. 2 lakhs, the revised market lot size shall be arrived at by multiplying the existing market lot in multiples of 2.
  • It has been observed that in case of the upward revision of the market lot, the existing positions are not a multiple of revised market lot and hence the modification of near month and mid month market lots would create non market lot positions which cannot be closed out by the member. Thus the far month contracts i.e. June 2005 which would be made available on April 1, 2005 will have the revised market lot. The contracts with the maturity of April 2005 and May 2005 would continue to have the existing market lots. Near month (April 2005) and mid month (May 2005) options contracts made available on account of variation in underlying prices would have the existing market lot and the far month options contract (June 2005) would have the revised market lot. All fresh month contracts made available subsequently would have revised market lot.

 

The list of securities/index in which the market lot is being revised downwards and upwards is enclosed as Annexure-1 and Annexure-2 respectively.  

 

The date of implementation for the revisions of market lot sizes will be April 1, 2005.

 

For any clarifications, members are advised to contact the following officials:

Mr Arvind Goyal & Mr Shibu Nair at 26598151 and 26598152

 

Yours faithfully,

For National Stock Exchange of India Ltd.

 

 

Latika S Kundu

Manager- F&O Trading

 

Annexure-1

 

List of underlying in which market lot is being revised downwards:

 

S.No

Underlying

Present Market lot

Revised market lot

1

ACC

1500

750

2

ANDHRABANK

4600

2300

3

ARVINDMILL

4300

2150

4

BAJAJAUTO

400

200

5

BANKINDIA

3800

1900

6

BHEL

600

300

7

GRASIM

350

175

8

GUJAMBCEM

1100

550

9

HCLTECH

1300

650

10

HDFC

600

300

11

HDFCBANK

800

400

12

HINDALC0

300

150

13

ICICIBANK

1400

700

14

INFOSYSTCH

200

100

15

ITC

300

150

16

NIFTY

200

100

17

ORIENTBANK

1200

600

18

PNB

1200

600

19

RANBAXY

400

200

20

SATYAMCOMP

1200

600

21

SYNDIBANK

7600

3800

22

TISCO

1350

675

23

UNIONBANK

4200

2100

24

WIPRO

600

300

 

Annexure-2

 

List of underlying in which market lot is being revised upwards:

 

S.No

Underlying

Present Market lot

Revised market lot

1

DRREDDY

200

400

2

I-FLEX

300

600

3

IPCL

1100

2200

4

MARUTI

400

800

5

POLARIS

1400

2800