Sebi curbs to help boost BSE's Sensex options, says CEO

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Subscribe to enjoy similar stories. Mumbai: Recent regulatory curbs on options trading will actually give a fillip to BSE Ltd's ongoing efforts to make the Sensex and Bankex options more mature products, enabling the exchange to potentially generate higher premium turnover and earn more in transaction charges, according to bourse’s MD and CEO Sundararaman Ramamurthy.

"The intention of BSE, notwithstanding the recent regulatory directives, (that) we have been regularly talking about is of deepening and broadening the market as our strategy for the year," Ramamurthy told investors recently after the company on Tuesday disclosed its September quarter earnings. “An important point we were making was to make Sensex and Bankex products mature...

Our efforts have been on (and) now it has got regulatory backing as well for us to promote them even better," Ramamurthy said in response to an analyst query on how the curbs would impact volumes Ashishkumar Chauhan, MD & CEO of BSE’s larger peer NSE, had said in a statement earlier this month that disappearance of trading volumes from the weekly Bank Nifty and other weekly option series would "substantially" decrease overall option index volumes. Chauhan, too, was responding to an analyst query after the exchange's Q2 earnings on 4 November.

Effective 20 November, BSE and NSE have been directed to offer just one weekly options expiry, according to a Sebi directive, as nine out of 10 individual traders lose money in index options trading. Other measures like an increase in contract lot size and value by three times from that date are expected to crimp trading volumes of index options, the most popular trading product.