It will be launched on 26 Feb & had one week contract & will expire on every Tuesday as market player asking less than month contract: as per Cnbc interview of person( forget name)
A National Stock Exchange (NSE) official said on Friday that equity would grow in popularity as an asset class over time although it remains fairly low on the radar of investors. “Things will improve over time,” said Ravi Varanasi, chief of business development at the NSE, at a conference in New Delhi.
He added that higher investment in equities in the developed world has been achieved though pension funds investing in equities. India has just started this with the National Pension System.
Preference for equity as an asset class remains fairly low in India. According to data available with the Reserve Bank of India (RBI), in 2012-13 only about 3.14% of total change in financial assets went to investments in shares and debentures. The comparable number for bank deposit was over 54%.
The savings rate in the economy has declined in recent years from 36.8% of gross domestic product (GDP) in 2007-08 to 30.1% of GDP in 2012-13. The decline in the savings rate has also taken its toll on savings in households, including financial savings, which have declined from 25.2% of GDP in 2009-10 to 22.3% in 2011-12, the latest available figure.
The NSE is currently on an investor awareness drive in the National Capital Region centred on New Delhi. The week-long drive will end on Sunday. The idea of the drive, which covered students, army personnel and corporates, is to create awareness about investment instruments such as exchange-traded funds, the rights and obligations of investors and risk-return relationship.
The NSE is also set to launch a futures contracts VIX (volatility index) called NVIX from 26 February.
The minimum contract size in this space will be Rs.10 lakh.
NVIX will allow market participants to trade against the volatility in the stock market. “The idea is provide an opportunity to investors who understand volatility and can use it to hedge their portfolios,” said Varanasi.
Investors who expect volatility to rise will go long, while those expecting the volatility to decline will short the index.