By IANS
Chicago : The Bombay Stock Exchange (BSE) Friday launched trading of Sensitive Index-based Futures on the US Futures Exchange (USFE) here amid what was described as a “lot of excitement” among emerging market hedge fund managers and other US investors.
The electronic trading began without any formal ceremony at 9 a.m., signalling the beginning of an era of global integration for the BSE.
A USFE spokesperson told IANS that they had been receiving a “lot of feedback” from emerging market hedge funds and other investors about the Futures. The official also said that there was a lot of interest among investors in Hong Kong, Singapore and elsewhere.
The trading, for the first time, allows US investors to directly participate in India’s equity markets without requiring American Depository Receipt (ADR) authorization.
The USFE said among the benefits of the trading will be that “overseas investors are now able to establish US regulated/non-American Depository Receipt (ADR) exposure in the Indian equity market”.
It said the BSE’s SENSEX future has “global appeal with widespread opportunities institutions, international mutual funds and individual investors”.
The trading will allow “immediate access to pure Indian equities exposure through existing futures accounts”. It will provide “trade with all the safety, security, and protections that a fully US regulated and cleared futures exchange provides”.
Said BSE managing director and CEO Rajnikant Patel: “The launch of a futures contract based on the Sensex will facilitate overseas investors in taking exposure to the Indian equities.”
He added: “I am confident the listing of the dollar denominated Sensex contract on USFE will elicit a very positive response from the international investing community.”
The contract will have a notional value of $40,000 and a tick value of $10. The clearing and settlement will take place through The Clearing Corporation, Chicago.
USFE’s US dollar-denominated Sensex futures contract will trade 23 hours per day and settle monthly to the corresponding value of BSE’s futures contract.