Millennium Post

FY16 currency derivative trade rises 36%

Currency derivative turnover on the three top bourses of the country surged 36 per cent to nearly Rs 76 lakh crore during last fiscal. The currency derivative turnover on the three exchanges -- NSE, BSE and MSEI -- stood at Rs 55.8 lakh crore during fiscal 2014-15, as per data from regulator Sebi and stock exchanges.

Moreover, the volumes of currency derivatives also rose by 28 per cent to 114.4 crore last fiscal compared with the same year-ago period. Individually, the turnover of currency derivatives at NSE increased to Rs 45 lakh crore in 2015-16, from Rs 30.2 lakh crore in the same period year-ago. 

The bourse has 59.3 per cent share in the currency derivative segment of the country’s capital markets. In 2014-15, it represented 54 per cent stake in the total turnover from the segment. The number of currency derivative contracts on NSE rose to 67.3 crore from 48 crore in the period under review.

BSE, which had commenced trading in currency derivatives in November, 2013, recorded a turnover of Rs 27.64 lakh crore in the segment, during the last fiscal. This is 45 per cent increase from Rs 19 lakh crore registered in 2014-15. 

Helped by its latest trading technology, BSE has fast become the second largest bourse in the country in this category with 36.4 per cent market share. The stock exchange witnessed trading in 42 crore currency derivative contracts in 2015-16 compared with 31 crore in 2014-15. Meanwhile, currency derivative turnover on MSEI, formerly known as MCX-SX, halved to Rs 3.24 lakh crore, during the last financial year. 

Its volume in terms of number of contracts traded in the segment declined to 4.6 crore from over 10 crore, for the period under review. 

Currency derivative contracts allow investors to take position on change in the foreign exchange rates between pairs of two currencies, such as rupee and dollar. Trading in currency derivatives in India was introduced in 2008 with National Stock Exchange being the first bourse to offer such trades.
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