December 27, 2007
The Managing Director / Executive Director of Derivative Segment of NSE & BSE and their Clearing House / Corporation.
Sub: Introduction of mini derivative (Futures & Options) contract on Index (Sensex & Nifty)
Pursuant to the recommendation of the Derivatives Market Review Committee (DMRC) headed by Professor M. Rammohan Rao, it has been decided to introduce mini derivative contract on Index (Sensex and Nifty).
I. CONTRACT SIZE
To begin with, the mini derivative contract on Index (Sensex and Nifty) shall have a minimum contract size of Rs. 1 lakh at the time of its introduction in the market.
II.RISK CONTAINMENT AND OTHER MEASURES
The existing risk containment and other measures applicable for existing exchange traded equity Index derivative contracts shall also be extended to the mini derivative contract on Index. The risk containment and other measures shall be the same as specified for the Index Futures and Index Option contracts in SEBI Circular Nos. IES/DC CIR-4/99 dated July 28, 1999, IES/DC/CIR-5/00 dated December 11, 2000, SMDRP/DC/CIR-7/01 dated June 20, 2001, SMD/DC/CIR-1 1/02 dated February 12, 2002, SEBI/DNPD/Cir-17/2003/10/29 dated October 29, 2003, SEBI/DNPD/Cir-26/32004/07/16 dated July 16, 2004 SEBI/DNPD/Cir27/2004/07/16 dated July 16,2004, DNPD/Cir-29/2005 dated September 14, 2005 and SEBI/DNPD/Cir-3 1/2006 dated September 22, 2006.
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.