US Indices Come to India

Rahul Oberoi/Money Today        Print Edition: October 2011

NSE brings US derivatives to India
Do you want to invest in the US markets and diversify your portfolio without having to deal with the hassles of buying overseas stocks? Now, you can invest in two major indices of the US through your regular trading account.

The National Stock Exchange (NSE) has launched derivative contracts of the world's most followed equity indices, the S&P 500 and the Dow Jones Industrial Average on August 29, 2011. This is the first time that derivative contracts of global indices have been launched in India.

The S&P 500 is an index comprising 500 leading US companies, while the Dow Jones comprises the 30 most liquid blue-chip firms based there.

These rupee-denominated contracts will be traded during normal Indian market hours. In order to promote participation in the contracts, the exchange has decided not to levy any transaction charges till February 29, 2012. The NSE has also announced cash incentives to brokers and clients to develop the market for these indices in India. The NSE has said that all the member brokers of its equity derivatives segment will be able to trade in these derivatives.

"Derivative contracts on these global indices will provide Indian investors easy access to the US in Indian market hours, without taking any currency risk," NSE managing director and chief executive officer Ravi Narain said in a statement.

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