General Manager
Derivatives and New Products Department
SEBI/DNPD/ /Cir-36/2008
April 4, 2008
To
The Managing Director / Executive Director of Derivative Segment of NSE & BSE and their Clearing House / Corporation.
Dear Sir,
Sub: Introduction of Bond Index
The SEBI appointed Derivatives Market Review Committee (DMRC), headed by Professor M. Rammohan Rao, recommended the introduction of Bond Index (both corporate and GOI) and Futures and Options on this Index.
Accordingly, it has been decided that, to begin with, Exchanges shall construct a Bond Index (both corporate & GOI) and disseminate the same. The Exchanges are free to decide whether they want to adopt any of the Bond Index computation models available globally or may like to develop their own model for computation of Bond Index. The detailed methodology for computing the Bond Index shall be disseminated by the Exchange for the benefit of the market participants and investors.
Based on experience gained and awareness generated, derivatives on Bond Index shall be considered for introduction in due course of time.
This circular is being issued in exercise of powers conferred by sub-section (1) of Section 11 of the Securities and Exchange Board of India Act, 1992, to promote the development of the securities market.
This circular is available on SEBI website at www.sebi.gov.in, under the category “Derivatives – Circulars”. The Circular shall come into force from the date of the circular.
Yours faithfully,
