NSE launches Futures contracts on India VIX called NVIX
NVIX was launched this morning in the presence of trading members and NSE’s MD and CEO, Ms Chitra Ramkrishna.
Today NVIX witnessed trading volumes of 325 crores and 227 members participated in trading in NVIX.
MD and CEO of the National Stock exchange , Ms Chitra Ramkrishna said "We have always benchmarked ourselves with global markets when we look at how we perform, and clearly the launch of NVIX will put us right up there with the global best. I am sure in our unique way, NSE in its unique way, will be able to capture the imagination of the global best."
Ms Chitra added "We have a very liquid options market, and that really gave us the stepping stone to create a product of this stature. Three years of dissemination of the product (India VIX) and tracking of the product by one and all has given the comfort to all of you and of course to the regulator to approve this product. NSE is committed to creating awareness on the product among institutions, clients and members."
NSE has been conducting a number of sessions with investors and trading members, to increase awareness on NVIX and its advantages for market participants. Webinars with prominent experts in Indian and global markets have also been conducted. NSE has launched a microsite, on its website, which provides all information on the product along with useful tools for calculation of theoretical price and analysis.
NSE has also offered a rebate on transaction charges for members, to encourage participation in the product. This will be applicable till 31st March, 2014.
NVIX futures will help market participants to hedge volatility risk, balance portfolios and express views on expected volatility. NVIX futures is traded in the F&O segment of NSE. All market participants currently permitted in the F&O segment are permitted to participate. The NVIX futures are based on underlying India VIX index. There will be 3 weekly futures contracts expiring on every Tuesday of the week. The lot size of NVIX contracts is 750 and tick size is Rs. 0.25. The India VIX index is calculated upto 4 decimals with a tick of 0.0025.
The volatility index has been introduced in several developed and emerging markets. The first volatility index and volatility index derivatives were introduced by CBOE. The progressive step taken by the regulators will help in deepening the equity derivatives market further and provide an asset class which is currently missing in the Indian capital markets.