NSE to Discontinue Weekly Expiry for Bank Nifty, Nifty Midcap Select, and Nifty Financial Services from November

Weekly Expiry Changes on NSE and BSE from November

Starting November, the National Stock Exchange (NSE) will discontinue the weekly index derivatives for Bank Nifty, Nifty Midcap Select, and Nifty Financial Services. According to a circular issued on October 10, the last trading date for these indices will be November 13, 18, and 19, respectively. 

After these changes, the Nifty 50 will be the only index on NSE available for weekly derivatives trading.

These changes follow the Securities and Exchange Board of India (SEBI) directive to limit weekly options expiries to just one index per exchange starting from November 20. As a result, BSE also plans to discontinue weekly index derivatives for SENSEX 50 on November 14 and BANKEX on November 18.

SEBI’s New Rules for Weekly Derivatives

SEBI, in a reform announcement on October 1, outlined several measures to improve investor protection and market stability in the derivatives segment. The new regulation restricting weekly derivatives contracts to just one index per exchange aims to tackle the increased volatility often seen during contract expiry days. This move is part of a broader effort to safeguard the financial markets from erratic price movements that can occur on expiry days.

Enhanced Market Monitoring Measures

In addition to the changes in weekly expiry, SEBI has introduced new monitoring rules for intraday positions. From November 20 onwards, exchanges will be required to monitor intraday positions at least four times a day, and penalties will be levied for any breaches, similar to those applied to end-of-day violations.

Impact on Traders and Investors

For traders and investors, these changes mean that after November 20, only the Nifty 50 on NSE and SENSEX on BSE will offer weekly derivatives trading. This shift could significantly alter trading strategies, especially for those who rely on shorter expiry options to hedge their positions.

The decision to reduce the number of weekly expiries is driven by SEBI’s commitment to minimizing market disruptions, ensuring that traders focus on a limited set of options while keeping market volatility in check.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.