The boom in derivatives trading in the historically-conservative markets, where some products such as stock futures are still too expensive, has come after the stock exchanges changed some options contracts to facilitate quicker and cheaper bets and as online retail trading platforms mushroomed.
Data from the exchanges show the daily average value of assets underlying these stock options more than doubled between March and October to $4.2 trillion. The ratio of the notional value of derivatives to cash trading is the highest in the world.
Sebi has so far not stepped in to curtail trading but has issued warnings and said it is aware of the risks.
The surge in options activity is more speculative than for hedging purposes, said Mihir Vora, chief investment officer at Trust Mutual Fund. "This can magnify any sharp falls in the market and act as a potential risk."
Bu hikaye Financial Express Mumbai dergisinin November 14, 2023 sayısından alınmıştır.
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Bu hikaye Financial Express Mumbai dergisinin November 14, 2023 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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