Nifty Lot Size reduced to 25-Effective 31st October 2014.

[sachin928111]

no need of lot size even a single share sud be allowed to be traded

 

[TraderRavi]

suppose a trader is trading with 1lakh per lot now he will have to trade with 2lots. intraday margin per lot will fall to around 6500 from current 13000.
there should be a mininifty with lot size 10.

 

[pakatil]

suppose a trader is trading with 1lakh per lot now he will have to trade with 2lots. intraday margin per lot will fall to around 6500 from current 13000.
there should be a mininifty with lot size 10.

Minifty has already been tried. It failed - Lack of Volumes.

 

[rajsingh]

I think this change will be effective jan contract onwards. Even lot sizes for individual stocks have been changed.



http://www.nse-india.com/content/circulars/FAOP27731.zip

 

[Jai Mata Di]

Nifty Lot Size reduced to 25, hence more volume-liquidity & less slippage..

Here is the inner details, why NSE reduces Nifty Lot size for TJ friends:-

In consultation with Stock Exchanges, it has been decided to
standardize the lot size for derivative contracts on individual securities by SEBI.

Latest rule (circular 2010) is:-

1.If underlying price is >= Rs. 1601 (Nifty belongs to that range) then total contract value must be >= Rs. 2 lakh.

There is no higher limit of contract value when the underlying price is above 1601.
But, to make F&O more affordable NSE tries to keep contract value 2 Lacs to 4 Lacs.

2. The Stock Exchanges shall review the lot size once in every 6 months based on the average of the closing price of the underlying for last one month and wherever warranted, can revise the lot size.

-------------
As the last month (Sept) average of the closing price of Nifty Spot was above 8000. Contract value was double (4 Lakh+) than required 2 Lakh.
NSE decided to reduce Nifty Lot size to half(25) according to the above rule.

It would add more liquidity to the system as volume would be double.
For example those who used to trade 1000 units(20 Lots), would trade later 40 lots(double volume). Hence more liquidity, less slippage. GOOD FOR TRADERS. :thumb:

But, there is a little problem if market remains below 8000 for some time (more than 6 month), only then NSE have to increase the lot size again.
Now it is Bull VS Bear fight again, in Nifty Lot size too. :annoyed: :rofl:

Here vote is only for Bull.... Keep Index above 8000. :thumb:

For beginners, there is also good news, they can try to practice effective position sizing, partial profit booking, averaging with only 2-4 lots (50-100 units).

Also smaller lot size and half margin would attract lot of beginners (option buyers,Intraday Cash Stock traders with low budget ) to Nifty Future Trading. That will also give more liquidity to the system. Hence, less slippage for high volume traders.

Happy Trading.

H.C.

 

[rajsingh]

There's no mention of SBI lot size. Since 1:10 split has been approved its bound to change.

 

[ram2010]

no need of lot size even a single share sud be allowed to be traded

yes. retail should be allowed to trade in any no. of quantities in nifty , bank nifty and sensex.

If it happens, (with discount brokers in hand) cash market volume will go to 0.:lol:

 

[lemondew]

Brokers get ready for 5 rs /lot. 20 Rs / lot wont do.

 

[tradedatrend]

Brokers get ready for 5 rs /lot. 20 Rs / lot wont do.

haha a signal for zerodha and their slaves

 

[HEM]

Re: Nifty Lot Size reduced to 25, hence more volume-liquidity & less slippage..

Here is the inner details, why NSE reduces Nifty Lot size for TJ friends:-

In consultation with Stock Exchanges, it has been decided to
standardize the lot size for derivative contracts on individual securities by SEBI.

Latest rule (circular 2010) is:-

1.If underlying price is >= Rs. 1601 (Nifty belongs to that range) then total contract value must be >= Rs. 2 lakh.

There is no higher limit of contract value when the underlying price is above 1601.
But, to make F&O more affordable NSE tries to keep contract value 2 Lacs to 4 Lacs.

2. The Stock Exchanges shall review the lot size once in every 6 months based on the average of the closing price of the underlying for last one month and wherever warranted, can revise the lot size.

-------------
As the last month (Sept) average of the closing price of Nifty Spot was above 8000. Contract value was double (4 Lakh+) than required 2 Lakh.
NSE decided to reduce Nifty Lot size to half(25) according to the above rule.

It would add more liquidity to the system as volume would be double.
For example those who used to trade 1000 units(20 Lots), would trade later 40 lots(double volume). Hence more liquidity, less slippage. GOOD FOR TRADERS. :thumb:

But, there is a little problem if market remains below 8000 for some time (more than 6 month), only then NSE have to increase the lot size again.
Now it is Bull VS Bear fight again, in Nifty Lot size too. :annoyed: :rofl:

Here vote is only for Bull.... Keep Index above 8000. :thumb:

For beginners, there is also good news, they can try to practice effective position sizing, partial profit booking, averaging with only 2-4 lots (50-100 units).

Also smaller lot size and half margin would attract lot of beginners (option buyers,Intraday Cash Stock traders with low budget ) to Nifty Future Trading. That will also give more liquidity to the system. Hence, less slippage for high volume traders.

Happy Trading.

H.C.

Dear H.C.,

Nice explanation........:thumb:


HEM