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NSE gets SEBI nod to launch derivatives on Nifty Midcap Select Index

The Nifty MidCap Select Index has given 38.73% return in the last one year and 19.4% annualised returns in the last five years. For the year 2021, the daily average turnover of midcap stocks surged 63% from a year ago to Rs 15220 crore.

January 10, 2022 / 08:12 PM IST



National Stock Exchange on Monday said it got approval from Securities Exchange Board of India(SEBI) to launch derivatives on Nifty MidCap Select Index and will start from January 24.


"Nifty Midcap Select index aims to track the performance of a focused portfolio of 25 stocks within the Nifty Midcap 150 index. All the index constituent stocks are individually available in derivatives. The weight of the stocks is based on free-float market capitalization methodology", NSE said in a statement.


Exchange will offer futures and options with a trading cycle of 7 weekly expiration contracts (excluding the monthly expiration contract) and 3 serial monthly expiration contracts. Index options will be European style with strike interval of 50 and strike scheme of 30–1–30 (OTM-ATM-ITM), the exchange added.


“The current availability of index derivatives on the exchange is largely focused on either the large cap stocks or sector specific stocks. The midcap stocks account for around 17% of market capitalization. The launch of derivatives on Nifty Midcap Select index will provide participants an additional hedging tool to manage their portfolio risk effectively” said Vikram Limaye, MD & CEO of NSE.


The Nifty MidCap Select Index has given 38.73% return in the last one year and 19.4% annualised returns in the last five years. For the year 2021, the daily average turnover of midcap stocks surged 63% from a year ago to Rs 15220 crore.