The lot size and expiry day of monthly, weekly, and long-dated futures and options contracts have been adjusted by stock exchange BSE in an effort to increase derivative trading in the Sensex and Bankex indices. According to a statement from BSE, this will take effect on May 15 of this year.
The lot size for Sensex futures and options contracts has been decreased from 15 to 10, according to the stock market. The lot size for futures and options contracts on the Bankex index has been reduced from 20 to 15.
Also, it has shifted Thursdays from the current Fridays to Fridays as the expiration day for its monthly, weekly, and long-dated futures and options contracts.
The prior trading day will be the expiry day if the expiry day falls on a trading holiday.
The monthly contracts are currently valid through the end of session on the final Thursday of each month, but the derivatives contracts (futures and options) expire on Thursdays.
A financial instrument called a derivative contract derives its value from an underlying asset. For instance, the price of an equity derivative contract moves in lockstep with the underlying equities index or stock.
“All the existing contracts of the S&P BSE Sensex (weekly, monthly, and long dated) and the S&P BSE Bankex (weekly and monthly) with expiry day as Thursday will expire on May 12, 2023, end of day, and will not be accessible for trading from May 15, 2023, onward, “BSE reported.
“New contracts of S&P BSE Sensex (weekly, monthly, and long dated) and S&P BSE Bankex (weekly and monthly), with Friday expiry and the aforementioned updated specifications, will be generated on May 12 end of day and will be accessible for trading starting on May 15,” “The sentence was read.
In addition, it stated that aside from the adjustments indicated above, all other contract specifications for futures and options contracts on the S&P BSE Sensex and S&P BSE Bankex would stay the same.