Sensex open interest jumped nearly 4X after expiry-day reshuffle even as weekly options dominate volumes, says BSE’ Chief Business Officer

bse bombay stock exchange

• Sensex derivatives open interest surged after expiry day shifted to Thursday
• 90% of trading volume is in current-week contracts, reflecting global trends.
• Thursday expiry increases participation and liquidity in longer-term contracts.

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Open interest in BSE’s Sensex derivatives has risen after recent changes to expiry days, highlighting a shift in trading patterns even as current-week options continue to dominate volume.

Speaking at the Indian Institutional Quant Conference in Mumbai on Friday, BSE’s Chief Business Officer, Sunil Ramrakhiani, said open interest on Sensex contracts jumped from around 17 lakh contracts to nearly 60 lakh after expiry was shifted from Tuesday to Thursday.

“When the guardrails were brought in with only two indices remaining in expiry, and we moved from Friday to Tuesday, the open interest started changing much more. Friday was 17 lakh contracts as far as open interest is concerned, and when we shifted to Thursday expiry, volumes and premiums increased,” he said.

Currently, more than 90% of trading volumes remain concentrated in current-week contracts, a pattern consistent with global markets. “That’s the kind of market we are into now. Weekly options have reshaped derivatives trading over the last 3-4 years,” he said, citing the global trend in S&P 500 options where daily expiries see similar volume concentration.

There’s also the behavioural and psychological shift among traders that was impacted, as a result of the change in expiry days: “A lot of guys sitting around here and anywhere in India and globally, they are not looking at Sensex till that time. Because they are so tuned to running their strategies from Monday to Thursday. They are not looking at Sensex. If you are going from Monday to Tuesday, those expiring strategies will continue.”

He explains, “Traders, especially on manual desks, still trade in points rather than focusing on index composition. That’s why when Bank Nifty moved from weekly to monthly, most of these guys started moving towards the Sensex.”

He highlighted that Sensex and Nifty are more than 99.5% correlated on daily returns, allowing similar strategies to be applied across both indices. However, traders’ behaviour, especially manual and proprietary desks, often focuses on point movements rather than index composition. The high base value of the Sensex has made it attractive to traders transitioning from Bank Nifty weekly contracts.

The move to Thursday expiry has begun broadening participation beyond pure expiry-day trading. Liquidity is building not only in current-week contracts but also in next-week and monthly expiries, creating opportunities for multi-legged and convergence-based strategies.