National Stock Exchange of India (NSE) on December 10 said it had received SEBI’s nod to launch derivatives on the Nifty Financial Services Index.
Currently, the exchange offers index derivatives on only two equity indices — Nifty 50 Index and Nifty Bank Index
This will be only the third equity index to have futures and options (F&O) contracts.
Date of launch
NSE will launch the index derivatives on the Nifty Financial Services Index from January 11, 2021.
7 Serial in a week
The NSE said it will offer futures and options in seven serial weekly, excluding the monthly expiry and three serial monthly contracts.
This is the first time that the exchange will make available weekly futures for the stock index derivatives.
Financial Sector
The Finance sector is on the top as compared to other sectors.
The financial services sector alone accounts for 33.5 percent of the Nifty500 index.
NSE underscored that recent investment data of Foreign Portfolio Investors (FPIs) indicates 48 percent of new investment flows were into the financial services sector.
Correlation and Beta
The Nifty Financial Services index has a 94 percent correlation and a beta value of 1.2 with the Nifty50 index.
It has a correlation of 98% with the Nifty Bank index.
The Nifty Financial Services index has delivered annualized returns of 14.99% in the last 5 years.
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