Trading in commodity derivatives segment can be done at a negative price now. The Bombay Stock Exchange (BSE) on April 28 said negative price levels feature in the exchange trading system for commodity derivatives segment is available.
"...exchange’s BOLT Plus trading system has been modified to accept orders and execute trades at negative prices. Accordingly, existing versions of trading system APIs – ETI as well as IML APIs will also support trading activity at negative price levels," BSE said in a press release.
As per the release, to facilitate testing of this feature in the simulation (test) environment, the trading price range of Brent Crude Oil futures contracts shall be suitably updated to accept orders at negative price levels and execute trades.
Trading Members and front-end trading application vendors shall be able to place test orders and trade in these contracts at those price levels. This will help members in checking the readiness of their internal systems and make suitable modifications if any required, said the press release.
The features shall be enabled in the simulation environment and made available to members and vendors to test from Monday, May 4, 2020, onwards, BSE said.
The announcement from BSE has come after the crude oil derivatives contracts fell into negative in the global markets weeks ago.
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