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Nifty Next 50 Index

Nifty Next 50 Index:

The National Stock Exchange (NSE) has announced the introduction of derivative contracts on the Nifty Next 50 index, set to commence from 24th April 2024.

  • The Nifty Next 50 Index represents 50 companies from Nifty 100, excluding the Nifty 50 companies.
  • NSE has received approval from the Securities and Exchange Board of India (SEBI) for these derivative contracts.
  • The exchange will provide three serial monthly index futures and index options contract cycles.
  • Contracts will be cash-settled and expire on the last Friday of the expiry month.
  • Derivatives in the market refer to financial contracts between two or more parties and derive their value from an underlying asset or benchmark.
  • There are two main types of derivatives:
    • Futures, which involve a binding agreement to buy or sell the underlying security on a future date.
    • Options, which give the holder the right (but not the obligation) to buy or sell the underlying asset at a predetermined price within a specified period.
  • The NSE is one of the two main stock exchanges in India, with the other being the Bombay Stock Exchange (BSE).
  • It was the first exchange in India to provide modern, fully automated electronic trading.
  • NSE emerged as the world’s largest derivatives exchange in 2023, in terms of the number of contracts traded, according to the Futures Industry Association (FIA).