EURO-INR, JPY-INR, Pound-INR contracts in India
SEBI has allowed trading of additional currency contracts apart from the currently traded USD-INR contracts. We’ll soon be able to trade the Euro, the Japanese Yen and the UK Pound (see Zip file) with...
View ArticleAre Futures Simply Better?
I’ve been railing about the cash volumes in the market recently. With volumes reaching 12,000 cr. – lesser than most of 2007 – and as I recently tweeted, less than the daily volume of one share, Apple,...
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NSE changes Lot Sizes for F&O, Finally
After SEBI standardised lot sizes, the National Stock Exchange has not acted to change the lot sizes, resulting in the unhappy situation of my not being able to take on a Tata Motors contract because...
View ArticleRupee Dollar Exchange Rate Woes
A reader mails in: While reading thru the financial page of a newspaper I read this - "The rupee surged to a six-month high against the dollar on Thursday & closed at 44.20, up from a low of 52.06,...
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Going Down in Flames: The 200 DMA Trade
Warning: Technical post (Repeated from the MarketVision blog) The 200-DMA setup went seriously against me - there was a slight attempt to take the 200 DMA again, in the morning, but the Nifty...
View ArticleYou Can Trade 91-day T-Bills Soon
Every regulatory body in the Indian market woke up recently and decided to allow Interest rate futures on treasury bills. SEBI said ok, and RBI said ok. What does this mean? The Indian government keeps...
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MV Chronicles: Downside Protection and Understanding Margins
The last two MarketVision Chronicles have some awesome (we’re modest) pieces for you. (You’ll need to register, and it’s Free!) Sep 12: Protecting the Downside Protecting the downside: Three Option...
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The Derivative Alternative
(From my article at Yahoo) While derivatives have been called weapons of mass destruction and worse, they can provide alternative methods to participate in the markets. To a bystander, these...
View ArticleQ&A: Futures Versus Cash
Suhail Kazi writes in on the derivatives post with a few questions that I thought belong in a separate post. a) Is there a T+2 (or other) settlement period for futures similar to stocks? No; when you...
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Nifty Future Premium Near The Highest Ever
What’s with the Nifty futures? With the Nifty closing at 5375, the futures were trading at 5441, a near 70 point premium.Measured as a fraction of the Nifty value, this is the highest premium we have...
View ArticleFutures and Options: An introduction
Futures and Options (F&O) is a famous phrase used by TV channels, web sites and in conversation nowadays but many of you many not familiar with the concept. Let me try and explain, in very simple...
View ArticleI am a stupid investor
I mentioned in my last post that I bought a Put option on Tata Steel. Now notice how much the 510 put option has fallen today. From Rs. 12 at yesterdays close to Rs. 2.4 closing today. That’s a loss of...
View ArticleA equity fund that’s like a debt fund: Arbitrage opportunities
How would you like to invest in a fund that gives you: a) better returns than liquid funds b) same risk as a liquid fund c) much better tax treatment than a liquid fund I can see you raising your...
View ArticleICICI IPO Oversubscribed; Dollar may drop; Buy yourself some portfolio insurance
ICICI Bank’s mega issue is fully subscribed on its opening day. According to NSE’s web site here are the stats (19/6/07): Institutions have already oversubscribed their part of the issue, by over 5.47...
View ArticleArbitrage funds are risky?
Are arbitrage mutual funds really risk free? PersonalFn attempts to debunk that theory saying: Buy-stock, sell-future is the common arbitrage used. Futures are usually priced higher than stocks. Yet,...
View ArticleThe futures opportunity
India is the world’s largest single stock futures market, according to an article in FT. Meaning, nowhere else in the world do people trade stock futures than in India. This is confirmed by Andy...
View ArticleA 5 day holiday and some performance updates
I’m taking a break till next Tuesday for an outstation holiday. I wanted to post a quick message about my momentum moves. Two weeks ago, I decided the Nifty wasn’t going anywhere and had talked about a...
View ArticleTransaction Updates:
Some updates on the transaction front. (Continuing from here) Bartronics hit my trailing stop loss (last high: 285, today’s price reached 257). I sold at 255. From my purchase price of Rs. 201, this is...
View ArticleSticky: Shenoy’s Investment Fundas
This post contains an organised series of links to my blog posts about investing. I hope to write more as we go along, and update this post constantly. This “book” should help you learn about...
View ArticleSEBI Says OK To More Derivative Contracts
SEBI has allowed the introduction of new derivative products in the Indian Captial Markets. Let me try to explain what new types can be used. Remember that some of the following fundas are speculation...
View ArticleMini Contracts and No Mutual Fund Entry Load
Mini Contracts NSE has introduced “mini-contracts” on the NIFTY. These are exactly the same as the futures contracts on the Nifty, but have a lot size of 20 instead of 50. The new symbol is MINIFTY....
View ArticleMarginal pressure
A lot of brokers have recently complained, in print and on mainstream TV, that NSE arbitrarily adjusts its margins upwards when a crash happens, and that triggers defaults at brokers, and for the...
View ArticleMargins – an NSE FAQ
NSE has released a detailed article on margins and how they are calculated. While some elements here are mathematical you can understand how margins work in general. The one thing you must remember is:...
View ArticleNo more margin tension for the calendar spreaders
SEBI has released a notification that calendar spreads (buying one month’s future and selling another) would no longer require margin towards the end of one of the contracts. The rule earlier was that...
View ArticleCross-margining: the why and the what
SEBI has announced cross-margining of cash and futures/options, for all participants. Cross-margining is essentially allowing cash positions (shares in a DP account) to offset margin requirements for...
View ArticleRevised Market Lots for futures, from March 2009
NSE has revised the market lot sizes for all futures/options contracts starting March 2009. The new lot sizes correspond to the 2 lakh contract size requirement SEBI has in place. Luckily the Nifty lot...
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SEBI Group Recommendations for Derivatives
A thought provoking set of recommendations for derivatives has been released by a SEBI working group. Mini contracts on equity futures, apart from the Mini Nifty. That happened almost automatically as...
View ArticleNSE changes lot sizes for 144 stocks
After the sudden upmove, a number of stocks have gone so far north that their lot sizes, which are usually calibrated to about 2 lakhs worth contracts each, are now a lot more expensive. So, from...
View ArticleSEBI Standardizes F&O Contract Lot Sizes
SEBI has now specified new lot size standards for all futures/options contracts: Price Band (Rs.) Contract Size Lot Size (No. of units of underlying) Value (Rs. lakh) =1601 125 = 2 801 – 1600 250 = 2 =...
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How Have Stocks Done In a Month of High Carry?
Last week was the Futures and Options expiry and something strange happened. The Nifty October Future – 1 month away – was at a 1.1% premium to the Nifty, something that hasn’t happened too often. This...
View ArticleInterest Rate Futures Get Some Market Love; 500 cr. Traded Today, 3,000 cr....
NSE Introduced Interest Rate Future (again) yesterday, and this time there seems to be some early interest from players. More than 3,000 cr. was traded yesterday and till 11 AM more than than 25,000...
View ArticleSEBI Increases Lot Sizes to Rs. 5 lakh from November, Index and Stock...
SEBI has changed the game for derivatives traders. A new circular (HT Vashistha) has increased the lot sizes of each contract, so that: The minimum contract size has been upped from Rs. 2 lakh to Rs. 5...
View ArticleWarning: December 2015 F&O Contracts Will Need To Be A Multiple Of 75, You...
Lot sizes for Futures and Options contracts starting November are increasing, and the Nifty will go to a lot size of 75. What happens, then, if you had bought LEAPS (Long Term Options) of December...
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