THE FUTURES AND OPTIONS SEGMENT UPDATES

HOW ARE STOCKS INCLUDED IN THE FUTURES AND OPTIONS SEGMENT??

EXCHANGES HAVE ANNOUNCED ADDITION OF SEVERAL STOCKS IN THE FUTURES AND OPTIONS SEGMENT RECENTLY. WHICH HAS LED TO NUMBER OF STOCKS ELIGIBLE FOR TRADE IN THIS SEGMENT RISING OVER 200.

source: google images

  1. FUTURES  : AN INVESTMENT OPPORTUNITY 

see the link above for information on what are futures and options. In addition, F&O are just like shares, they are also sold and bought in the market. In the link above you will find all the details regarding types of futures and process of investing also.

2. what are the criteria for inclusion of securities in F&O??

For inclusion in segment, a stock is chosen from the top 500 stocks. Which is based on average daily traded value and market capital in the previous six months on rolling basis. Furthermore, average of buying and selling price shall not be less than RS 10 lakh. In addition, if a stock fails to meet the eligibility criteria for 3  months, the exchanges stop issuing fresh contracts on that security.

3. Criteria for re-inclusion of excluded stocks ??

Once excluded, the stock will not be considered for inclusion before one year. Furthermore, for re-inclusion the security has to meet eligibility criteria for 3  months.

4. why have so many securities been added to F&O segment??

NSE announced addition of 15 securities in this segment from April series. Following this exchange announced addition of more securities in the segment. Just like this now there were around 200 securities in this segment. Furthermore, the small cap-segment helped majority of stocks to meet the criteria for inclusion in the F&O segment.

source: google images

NEWS

The daily turnover for futures and options on the NSE hit a record high of Rs 93,298.96 crore and Rs 42,843.59 crore respectively ( 27/7/2016). The previous high for stock futures was Rs 88,961.55 crore on July 26. While, for stock options it was Rs 41,503.57 crore on July 15, according to data provided by the stock exchange.

POST SCRIPT : Most noteworthy, fact about futures is that you get to earn from a commodity without actually buying it.

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