Large F&O lot to hit trade volume
The new lot size will come into effect from November series onwards
By : DC Correspondent
Update: 2015-10-29 07:12 GMT
MUMBAI: The minimum trading lot for the derivative contracts, which has been revised higher to keep away small investors is expected to bring down the volume in the equity derivative segments in the coming days. The new lot size will come into effect from November series onwards.
“This move will have different impact on different instruments. We expect to see maximum negative impact in stock futures and stock options volume, which may see significant dip in volumes. Apart from that, index futures may also see some decline in volumes. Interestingly, we believe that volumes in index options will increase meaningfully,” said Vijay Singhania, founder director, Trade Smart Online, a leading discount brokerage firm.
With the October derivative series set to expire on October 29 (Thursday), derivative experts feel that the revised lot size could have an impact on the fresh open interest position that would be carried forward to the next month.
“There are lot of stock futures contract where retail investors are presently sitting on huge losses. Majority of them would be forced to book losses and exit the market as they would find it difficult to bring in additional money to meet the increased margin requirement,” said Siddarth Bhamre, head of derivatives at Angel Broking.