Capital market regulator Sebi has finally given its go-ahead to the National Stock Exchange (NSE) to launch derivatives on its volatility index, VIX. Over the next few days, the exchange will start futures and options contracts on the index, which measures market volatility, said two officials familiar with the development.
What is India "VIX":India VIX is a volatility index based on Option price of NIFTY Index . From the best bid-ask price of NIFTY Options contracts, a volatility figure is calculated in % . This indicates the expected market volatility over the next 30 days,” according to the NSE.
.
 |
The Nifty VIX contracts will be available in the existing futures and options segment on the NSE...
To help investors volatility risks in their equity portfolio by hedge strategies, the National Stock Exchange said it will launch its futures contracts on India VIX called 'NVIX' from February 26.
NVIX will help market participant to get directional view on volatility and will give option traders more device to hedge volatility risk in their option portfolios.
India VIX is a index which measures the market expectation of volatility over the near term based on NIFTY Index option prices. Volatility Index is a measure, of the amount by which an underlying Index is expected to fluctuate, in the near term based on the order book of the underlying index options.
The contract symbol for Nifty VIX will be IndiaViX and three-weekly contracts will be made available for trading. The contracts will expire on every Tuesday and the contract value will be min 10 lakh .
A high VIX value would suggest that the market expects significant increase in volatility, while a low value indicates the reverse.
0 comments:
Post a Comment