Corelation-Nifty Futures- Current Month, Next Month & 3rd month..

tradingstudent

Well-Known Member
#1
Hello Traderji members,

When i researched, i came to know there are three month series for Nifty.

Example:
Nifty Futures for April
Nifty Futures for May
Nifty Futures for June

If the future in a given month moves upwards, does the corresponding months also move upwards?

My point being, is there any co relation between the different months that is guaranteed or should we consider each month as a standalone entity?

Thanks
 

toughard

Well-Known Member
#2
Hello Traderji members,

When i researched, i came to know there are three month series for Nifty.

Example:
Nifty Futures for April
Nifty Futures for May
Nifty Futures for June

If the future in a given month moves upwards, does the corresponding months also move upwards?

My point being, is there any co relation between the different months that is guaranteed or should we consider each month as a standalone entity?

Thanks
In any forward trading concepts the correlation must exists. you ca observe the validation point and the degree of correlation personally for some days and related them to characteristics of options.
 

TradeOptions

Well-Known Member
#3
Hello Traderji members,

When i researched, i came to know there are three month series for Nifty.

Example:
Nifty Futures for April
Nifty Futures for May
Nifty Futures for June

If the future in a given month moves upwards, does the corresponding months also move upwards?

My point being, is there any co relation between the different months that is guaranteed or should we consider each month as a standalone entity?

Thanks
Yes, they are correlated. On temporary basis they can show divergent movements for very short period of times, based on the order-flow, but overall they are correlated.
 
#4
Most of the time I have experienced major deviation on expiry day specially in last 30 mins, but usually they are correlated with very minor diversions.
But I have seen that some players play pair trading in nifty calender futures for gain of few ticks difference.
 

TradeOptions

Well-Known Member
#5
Most of the time I have experienced major deviation on expiry day specially in last 30 mins, but usually they are correlated with very minor diversions.
But I have seen that some players play pair trading in nifty calender futures for gain of few ticks difference.
Yes, major deviation on the expiry day, that too in the last 30 min is very expected because of the contracts being rolled over into the next series by those guys who do not want to settle their open positions of the current series.
 

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