The S&P Cnx Nifty
The S&P CNX Nifty is an market capitalisation index based upon solid economic research. It was designed not only as a barometer of market movement but also to be a foundation of the new world of financial products based on…
Category Futures & Options
Type of Indexes
Most of the commonly followed stock market indexes are of the following two types: Market capitalization weighted index or price weighted index. In a market capitalization weighted index, each stock in the index affects the index value in proportion to the…
Economic Significance of Index Movements
ECONOMIC SIGNIFICANCE OF INDEX MOVEMENTS How do we interpret index movements? What do these movements mean? They reflect the changing expectations of the stock market about future dividends of the corporate sector. The inde.’S goes up if the stock market…
Chapter Two Market Index
CHAPTER TWO MARKET INDEX To understand the use and Function of the Index derivatives Markets, it is necessary to understand the underlying index. In the following Section, we take a look at index related issues. Traditionally, indexes have been used…
Trading Mechanism
The futures and options trading system of NSE. called NEAT F&O trading system, provides a fully automated screen based trading for Nifty futures and options and stock futures and options on a nation wide basis and an online monitoring and…
Nse’s Derivatives Market
The derivatives trading on the NSE commenced with S & P CNX Nifty Index futures on June. 12.2000. The trading in Index options commenced on June 4. 2001 and trading in options on individual securities commenced on July 2. 2001.…
Exchange Vs Otc Derivatives Markets
Derivatives have probably been around for as long as people have been trading with one another. Forward contracting dates back at least to the 12th century, and may well have been around before then. Merchants entered into contracts with one…
History Of Derivatives Market
HISTORY OF DERIVATIVES MARKET: Early forward contracts in the US., addressed merchants concerns about ensuring that there were buyers and sellers for commodities. However “credit risk” remained a serious problem. To deal with this problem, a group of Chicago business…
Economic Function Of Derivative Market
Inspite of the fear and criticism with which the derivatives markets are commonly looked at. these markets perform a number of economic functions. Princes in an organized derivatives market reflect the perfection of market participants about the future and lead…
Derivative Products
Derivative contracts have several variants. The most common variants are forwards, futures, options and swaps. We take a brief look at various derivatives contracts that have come to be used. FORWARDS: A forward contract is a customized contract between two…