Revision of market lots

vince

Active Member
#1
Here is a circular issued by the NSE to this effect.

High time and most welcome.

Could be a result of the discussions here, more power to traderji.

NATIONAL STOCK EXCHANGE OF INDIA LIMITED

FUTURES AND OPTIONS SEGMENT



CIRCULAR



Circular No.: NSE/F&O/010/2007 Date: February 6, 2007

Download No. NSE/FAOP/8483



Dear Members,

Subject: Revision of Market Lot of Derivative Contracts



Exchange reviews on a periodic basis the contract size/value of derivative contracts based on prescribed minimum value of INR 200,000 as per SEBI circular no. SEBI/DNPD/CIR- 20/2004/02/ 23 dated February 23, 2004. It is proposed to carry out revision of market lots for derivatives contract as given below:



Sr No


Underlying whose Derivative contract size /value is
Revising methodology
Effective date
Annexure Number for list of underlying

1
Higher than INR 800,000
Dividing existing lot by 4
February 23, 2007

(for all contracts)
1

2
Higher than INR 400,000
Dividing existing lot by 2
February 23, 2007

(for all contracts)
2

3
Higher than INR 800,000 but lot size not exactly divisible by 4
Dividing existing lot by 4 & rounding off to nearest integer.
February 23, 2007

(for May 2007 & later expiries)
3

4
Higher than INR 400,000 but lot size not exactly divisible by 2
Dividing existing lot by 2 & rounding off to nearest integer.
February 23, 2007

(for May 2007 & later expiries)
4

5
Lower than INR 200,000
Multiplying existing lot by 2
February 23, 2007

(for May 2007 & later expiries)
5




To avoid operational complexities, in cases 3, 4 & 5 above, only the far month contract i.e. May 2007 expiry contracts will be revised for market lots. Contracts with maturity of March 2007 and April 2007 would continue to have the existing market lots. All subsequent contracts (i.e., May 2007 expiry and beyond) will have revised market lots.



For any clarifications, members are advised to contact the following officials:

Mr. Arvind Goyal, Mr. Sachin Dhar & Ms. Shalini Rebeiro at 26598151 or 26598152



Yours faithfully,

For National Stock Exchange of India Ltd.





T S Jagadharini

Vice President



Annexure-1



List of underlying in which market lot is being revised downwards:

Sr No
Underlying
Symbol
Present Market Lot
Revised market Lot

1
IFCI Ltd
IFCI
31500
7875




Annexure-2



List of underlying in which market lot is being revised downwards:

Sr No
Underlying
Symbol
Present Market Lot
Revised market Lot

1
NSE 50 Index
NIFTY
100
50

2
BANK Nifty Index
BANKNIFTY
100
50

3
Allahabad Bank
ALBK
4900
2450

4
Alok Industries Ltd
ALOKTEXT
6700
3350

5
Andhra Bank Ltd
ANDHRABANK
4600
2300

6
Ashok Leyland Ltd
ASHOKLEY
9550
4775

7
Bank Of India
BANKINDIA
3800
1900

8
Bharti Airtel Limited
BHARTIARTL
1000
500

9
Century Textiles Ltd
CENTURYTEX
850
425

10
CESC Ltd
CESC
1100
550

11
Cummins India Ltd
CUMMINSIND
1900
950

12
Escorts India Ltd
ESCORTS
4800
2400

13
Gail ( India ) Ltd
GAIL
1500
750

14
HCL Technologies Ltd
HCLTECH
650
325

15
HDFC Ltd
HDFC
300
150

16
HDFC Bank Ltd
HDFCBANK
400
200

17
ICICI Bank Ltd.
ICICIBANK
700
350

18
Indus Dev Bank Of Ind Ltd
IDBI
4800
2400

19
Infra. Dev. Fin. Co. Ltd
IDFC
5900
2950

20
I-Flex Solutions Limited
I-FLEX
300
150

21
Indusind Bank Limited
INDUSINDBK
7700
3850

22
Infosys Technologies Ltd
INFOSYSTCH
200
100

23
IVRCL Infrast & Proj Ltd.
IVRCLINFRA
1000
500

24
J & K Bank Ltd.
J&KBANK
600
300

25
Jindal Steel & Power Ltd
JINDALSTEL
250
125

26
Jaiprakash Hydropow Ltd.
JPHYDRO
12500
6250

27
Jindal Stainless Ltd
JSTAINLESS
4000
2000

28
Karnataka Bank Limited
KTKBANK
2500
1250

29
Maharashtra Seamless Ltd
MAHSEAMLES
1200
600

30
Mphasis Limited
MPHASIS
1600
800

31
Nagarjuna Fertilizers Ltd
NAGARFERT
28000
14000

32
NDTV Ltd
NDTV
2200
1100

33
Nicolas Piramal India Ltd
NICOLASPIR
2090
1045

34
NTPC Ltd
NTPC
3250
1625

35
Oil And Natural Gas Corp.
ONGC
450
225

36
Punjab National Bank
PNB
1200
600

37
Polaris Software Lab Ltd
POLARIS
2800
1400

38
Reliance Industries Ltd
RELIANCE
300
150

39
State Bank Of India
SBIN
500
250

40
Sun Pharmaceuticals Ind.
SUNPHARMA
450
225

41
Sun TV Limited
SUNTV
250
125

42
Syndicate Bank
SYNDIBANK
7600
3800

43
Tata Power Co Ltd
TATAPOWER
800
400

44
Union Bank Of India
UNIONBANK
4200
2100

45
UTI Bank Ltd
UTIBANK
900
450




Annexure-3



List of underlying in which market lot is being revised downward and rounded off to nearest integer:

Sr No
Underlying
Symbol
Present Market Lot
Revised market Lot

1
Divis Lab Ltd
DIVISLAB
250
62




Annexure-4



List of underlying in which market lot is being revised downward and rounded off to nearest integer:

Sr No
Underlying
Symbol
Present Market Lot
Revised market Lot

1
Grasim Industries Ltd
GRASIM
175
88

2
Mahindra & Mahindra Ltd
M&M
625
312

3
Siemens Ltd
SIEMENS
375
188

4
Sterlite Inds (Ind ) Ltd
STER
875
438

5
Titan Industries Ltd
TITAN
411
206






Annexure-5



List of underlying in which market lot is being revised upwards:

Sr No
Underlying
Symbol
Present Market Lot
Revised market Lot

1
Bajaj Hindustan Ltd
BAJAJHIND
950
1900

2
Balrampur Chini Mills Ltd
BALRAMCHIN
2400
4800

3
Cairn India Limited
CAIRN
1250
2500

4
Chennai Petroleum Corp Lt
CHENNPETRO
900
1800

5
Colgate Palmolive (I) Ltd
COLGATE
525
1050

6
Gateway Distriparks Ltd.
GDL
1000
2000

7
The GeShpg.Ltd
GESHIP
600
1200

8
ITC Ltd
ITC
1125
2250

9
Shree Renuka Sugars Ltd
RENUKA
500
1000

10
Tata Tea Ltd
TATATEA
275
550

11
Triveni Engg. & Inds. Ltd
TRIVENI
3850
7700

12
Voltas Ltd
VOLTAS
1800
3600
 

Linus

Active Member
#4
After all, the babus made it!! It reminds me of a line from Hard Traget - 'The wheels turn slowly here, but they do turn!'

ss:)
 

RSI

Well-Known Member
#5
My thread on this subject initiated yesterday night seems to have gone unnoticed. Never mind about it. I too wanted a discussion on this. I am glad that at least this thread has caught attention of members. Please ponder on these points:-

1. What will happen if the brokerage per lot remains same? To my knowledge some trading houses are charging a fixed brokerage for one lot of Nifty and other future contracts. If they do not cut down the brokerage, what will be the position of the trader especially the day trader and the scalper? To quote an example, if a broker charges Rs. 300/- per Nifty lot, now, a favourable movement of four points will take care of borkerage and taxes etc. If the lot size is reduced to 50, Nifty will have to move eight points just to cover costs.

2. Will it make the market more volatile? For two reasons, one to cover costs by scalpers and day traders. Second, I persume many small retail guys may venture out to F&O section under the presumption that lot size reduction is working to their advantage.

Any guess on these points?
Regards
R. S. Iyer
 
#6
My thread on this subject initiated yesterday night seems to have gone unnoticed. Never mind about it. I too wanted a discussion on this. I am glad that at least this thread has caught attention of members. Please ponder on these points:-

1. What will happen if the brokerage per lot remains same? To my knowledge some trading houses are charging a fixed brokerage for one lot of Nifty and other future contracts. If they do not cut down the brokerage, what will be the position of the trader especially the day trader and the scalper? To quote an example, if a broker charges Rs. 300/- per Nifty lot, now, a favourable movement of four points will take care of borkerage and taxes etc. If the lot size is reduced to 50, Nifty will have to move eight points just to cover costs.

2. Will it make the market more volatile? For two reasons, one to cover costs by scalpers and day traders. Second, I persume many small retail guys may venture out to F&O section under the presumption that lot size reduction is working to their advantage.

Any guess on these points?
Regards
R. S. Iyer
Sir,
It may happen that the current charges would stay in place per lot basis, So all the brokerage houses, which charges on per lot basis, would be charging double. However I think this situation would make these brokerage houses uncompetitive, which would then force them to reduce the per lot fixed charges.

It would surely make market more volatile, But It may not attract a big % of general public. To attract them, the derivative lot sizes needs to be lower down to 50000-100000Rs range.
 

beginner_av

Well-Known Member
#7
hey nothing great about it...they do it every year...tomorrow if nifty falls below 3800 or so, it will be back to 100

and as for RSI, if u r concerned with brokerage, u have to trade bigger lots e.g hpcl was 650, sometime back it became 1300...

rgds.
 

beginner_av

Well-Known Member
#8
to add on...it works both ways...the opposite effect is true for contracts that have been doubled...and if u were in bear mkt...more contracts would have doubled than halved.
 

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