Top stock exchange NSE has increased the market lot sizes of derivatives contracts in 151 stocks including several blue-chip companies, while it has revised downwards the market lots of four firms.
The National Stock Exchange (NSE) has also increased the market lots of derivatives contracts on eight of its indices — Nifty, Bank Nifty, IT, Infrastructure, PSE, Nifty Midcap 50, Dow Jones Industrial Avg, FTSE 100. The market lots for contracts on S&P 500 remains unchanged.
The move comes after market regulator Sebi’s decision in July to hike the minimum investment size for any equity derivative product to Rs 5 lakh from Rs 2 lakh. The measure will help safeguard small investors from high-risk products.
In separate circulars, NSE said that the revised market lots would be applicable only for November expiry contracts and would come into effect from August 28.
“Contracts with maturity of September 2015 and October 2015 would continue to have the existing market lots,” it said adding that “all subsequent contracts (November 2015 expiry and beyond) will have revised market lots“.
NSE also said “the day spread order book will not be available for the combination contract of October 2015 — November 2015 expiry”.
The market lots on derivatives has been hiked for 151 individual stocks. BHEL, Reliance Industries, Hero MotoCorp, HDFC, Lupin, Kotak Bank, TCS, Bajaj Auto, GAIL, State Bank of India, TCS, Cipla, Tata Motors, were among the key stocks for which the lots were revised upwards.
Meanwhile, NSE has revised downwards the market lots in derivative contracts for Bosch, Eicher Motors, MRF and Page Industries.
It has left market lots for derivatives contracts on Bajaj Finance and Maruti Suzuki unchanged at 125.
Separately, the exchange notified that the “lot size of all existing Nifty long-term options contracts [having expiry greater than three months and including December 2015 contracts] shall be revised from 50 to 75 after expiry of September 2015 contracts [with effect from September 28, 2015]”.
A derivative is a security derived from a debt instrument, share, loan, whether secured or unsecured or any other form of security. It also derives its value from the prices, or index of prices, of underlying securities.
