NSE waives transaction charges on Nifty Next 50 F&O trades for next 6 months

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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On April 23, the National Stock Exchange of India (NSE) announced that it would waive transaction charges on futures and options (F&O) contracts traded on the Nifty Next 50 index for the next six months, from April 24, 2024, to October 31, 2024.

In a circular released on April 23, the NSE stated, “In order to encourage active participants in Futures and Options contracts on Nifty Next 50 Index, it has been decided that no transaction charges will be levied on the trades done in Futures and Options contracts on Nifty Next 50 Index (NIFTYNXT50) in Future & Options segment from April 24, 2024 (product launch date) till October 31, 2024.”

This announcement follows closely after NSE’s recent introduction of trading in F&O contracts on the Nifty Next 50 Index, which will be effective from April 24, 2024.

Sriram Krishnan, Chief Business Development Officer at NSE, emphasised the significance of introducing derivatives on the Nifty Next 50 index, saying, “The introduction of derivatives on the Nifty Next 50 index (NIFTYNXT50) will complement the existing index derivatives product suite well. The Nifty Next 50 index represents the space between the Nifty 50 index, comprising the top large and liquid stocks, and the Nifty Midcap Select index, comprising the top large and liquid mid-capitalised stocks.”

Also Read: NSE to introduce derivatives on Nifty Next 50 index from April 24, check details here

The newly-introduced cash-settled derivatives contracts will expire on the last Friday of the expiry month, as per NSE’s announcement.

The Nifty Next 50 Index includes 50 companies from the Nifty 100, excluding the Nifty 50 companies. It is also known as Junior Nifty.

As of March 2024, the index’s top sector representation came from the financial services sector, with a weight of 23.76%, followed by the capital goods sector at 11.91% and consumer services at 11.57%. The index was introduced on January 1, 1997, with the base date and base value being November 3, 1996, and 1000, respectively.

The market capitalisation of index constituents stands at ₹70 lakh crore, representing about 18% of the total market capitalisation of the stocks listed on the NSE as of March 29, 2024. The aggregate daily average turnover of index constituents stood at ₹9,560 crore, accounting for around 12% of the cash market turnover in FY24.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow