In order to strengthen the framework for equity index derivatives to enhance investor protection and market stability, SEBI in its circular dated 10 October warned against the suspension of weekly index option contracts on 3 indices including Nifty Bank (BANK NIFTY)
Two other contracts whose weekly index options will be terminated are Nifty Midcap Select (MIDCPNIFTY) and Nifty Financial Services (FINNIFTY).
However, the last trading date and expiry of the weekly index option available on these indices will be as follows:
For Nifty Midcap Select and Nifty Financial Services, the cut-off or last date of trading will be November 18 and November 19, respectively.
As mentioned in the SEBI circular, each Exchange may offer derivative contracts only for its benchmark index expiring on a weekly basis and will be effective from 20 November 2024., i.e. from this date each weekly derivative contract will be available only on one benchmark index. Each exchange. Accordingly, the Exchange will continue to make weekly index options available only on the Nifty 50 Index (NIFTY), the circular added.
Anand Rathi’s Jigal Patel said, “Today is the last expiry of Bank Nifty weekly options, and from the next expiry, which will be monthly, several results are expected in the market. Firstly, the volatility is expected to decrease as the general speculation associated with weekly options will decrease , brings a stable trading environment In addition, the overall volume of Futures and Options (F&O) may decrease slightly without the usual gain of weekly Bank Nifty options.
The positive aspect of this change is that the Nifty index is likely to have greater stability, as large-cap stocks like ICICI Bank, HDFC Bank, and SBI—which play an important role in both the Bank Nifty and Nifty indices—will have reduced over time. short. speculative pressure, leading to potentially stable performance in these key stocks, he added.
