Monday will mark the beginning of trading in
, the new avatar of
– the globally popular derivatives contract on NSE’s Nifty index that till Friday was traded on the Singapore exchange (SGX). From Monday, these same derivatives contracts of
will start trading on the NSE’s international exchange at Gujarat’s International Financial Services Centre (IFSC). This shift of the bourse from Singapore to India is under an arrangement between the NSE and SGX…
What’s SGX Nifty/GIFT Nifty?
It’s a derivatives contract on the NSE’s Nifty index that starts trading a few hours before the Indian market opens, and continues to trade till the wee hours of India time. The early session makes these contracts a good indicator for investors to take a call on the Nifty before it starts trading on the NSE.
What are the differences between Nifty contracts traded on the NSE and those on the GIFT Nifty?
Nifty contracts traded on the NSE are denominated in rupees, while those on the GIFT Nifty are denominated in US dollars. Indian contracts are traded from 9am to 4pm, while contracts on the IFSC will be traded from 6.30am to 3.40pm, and then again from 4.35pm to 2.45am (all India time).
How popular are SGX Nifty contracts?
Till recently, daily volumes in these contracts amounted to $1.5-2 billion. All the open contracts on the SGX as of Friday’s close of trading will be shifted to the NSE’s IFSC exchange when it starts trading GIFT Nifty contracts from Monday.
What are the benefits of GIFT Nifty trading?
Since IFSC is a special economic zone (SEZ), all tradings here are exempt from securities transaction tax (
), commodities transaction tax (CTT) and dividend distribution tax. The centre also enjoys capital gains tax and income tax waivers.