MCX gets regulator’s nod for currency options
6 Aug 2012 7:19 AM IST
MCX Stock Exchange (MCX-SX) on Sunday said it has received approvals from market watchdog Securities and Exchange Board of India (SEBI) and banking regulator the Reserve Bank of India (RBI) to launch Currency Options.
These approvals will enable the exchange to expand its offerings in the currency derivatives segment (CDS) by introducing currency options in the Dollar-Indian Rupee currency pair.
MCX-SX said it held a successful mock trading session on 4 August 2012 and will soon announce the date of live trading of Currency Options. Currency options are contracts that grant the buyer of the option the right, but not the obligation, to buy or sell the underlying currency at a specified exchange rate during a specified period.
MCX-SX, whose application for a full-fledged stock exchange was recently approved by SEBI currently offers trading in only currency futures.
It has witnessed a steady and significant growth in currency futures turnover and open interest and continued to maintain its leadership in currency futures with a market share of 43.57 per cent in the last fiscal.
The average daily turnover has increased from Rs 324.78 crore during its first month of operations to Rs 13,530.47 crore at the end of July 2012.
The MCX-SX currency futures platform is supported by a strong membership base of 751 members and witnesses nationwide participation from 714 towns and cities across India, the exchange said.
Commenting on the latest development MCX-SX MD and CEO Joseph Massey said: ‘We thank SEBI and RBI for allowing us to introduce Currency Options on our exchange. Options have the comparative advantage of maintaining a certain degree of flexibility in hedging.’
These approvals will enable the exchange to expand its offerings in the currency derivatives segment (CDS) by introducing currency options in the Dollar-Indian Rupee currency pair.
MCX-SX said it held a successful mock trading session on 4 August 2012 and will soon announce the date of live trading of Currency Options. Currency options are contracts that grant the buyer of the option the right, but not the obligation, to buy or sell the underlying currency at a specified exchange rate during a specified period.
MCX-SX, whose application for a full-fledged stock exchange was recently approved by SEBI currently offers trading in only currency futures.
It has witnessed a steady and significant growth in currency futures turnover and open interest and continued to maintain its leadership in currency futures with a market share of 43.57 per cent in the last fiscal.
The average daily turnover has increased from Rs 324.78 crore during its first month of operations to Rs 13,530.47 crore at the end of July 2012.
The MCX-SX currency futures platform is supported by a strong membership base of 751 members and witnesses nationwide participation from 714 towns and cities across India, the exchange said.
Commenting on the latest development MCX-SX MD and CEO Joseph Massey said: ‘We thank SEBI and RBI for allowing us to introduce Currency Options on our exchange. Options have the comparative advantage of maintaining a certain degree of flexibility in hedging.’
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