BSE – Redefining the Landscape of Commodity Derivatives Market
Dalal Street Investment Journal|February 17, 2020
With options on goods, participants can actually give or take delivery of the underlying without getting into the futures contract at the time of expiry. Secondly, in case of cash settled contracts, options can be settled on the spot of the underlying.
BSE – Redefining the Landscape of Commodity Derivatives Market

Ashishkumar Chauhan MD & CEO, BSE (Bombay Stock Exchange)

The organized marketplace for commodity markets in India have evolved significantly with the introduction of commodity derivative exchanges in 2003, enactment of Warehousing Development and Regulatory Authority and the merger of FMC with SEBI effective September 28, 2015. However, the commodity derivatives market has found a renewed vigor with SEBI permitting the formation of universal exchange, i.e. integrating trading in equities, currency and commodities on a single platform from October 1, 2018. This move helped participants in various markets with a highly regulated, safer and more transparent trading, clearing and settlement framework. Moreover, trading in a universal exchange offers significantly greater convenience for investors and traders, who are able to trade in all asset categories from a single account, reaping benefits arising from enhanced competition across all categories, thus creating deeper markets with lower spreads and transaction charges.

Commodity Derivatives Market - BSE Foray Opening New Vistas

Following SEBI approval in October 2018, BSE became India’s first universal exchange and currently offers all assets classes permitted for trading that includes equity, equity, currency, interest rate and commodity derivatives in its portfolio. Established in 1875, the BSE traces its roots to cotton trading during the 1850’s, and it was natural for us to launch commodity derivatives trading.

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