National Stock Exchange of India

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National Stock Exchange of India (NSE)
NSEI.gif
Founded 1992
Headquarters Mumbai, India
Key People Chitra Ramkrishna, CEO; Ravi Narain, non-exec vice chairman
Products S&P CNX Nifty index
Website www.nse-india.com

The National Stock Exchange of India (NSE) became the country's largest stock exchange soon after its launch in 1993 and hosts India's main equities benchmark, the S&P CNX Nifty. The NSE also lists derivatives, where it holds a near-monopoly of the Indian market, and it is now the world's largest exchange for single-stock futures trading on its integrated electronic trading platform.

According to the annual Futures Industry Association's survey of the world's leading derivatives exchanges in 2012, the National Stock Exchange of India was ranked as the world's third-largest derivatives exchange by contract volume, putting it below Eurex and above NYSE Euronext. [1]

The report released in March of 2013 states that the number of futures and options traded on NSE fell 8.6 percent from 2011, to over 2 billion contracts.

Background

The NSE was created in 1992 by a consortium of Indian banks including State Bank of India, Union Bank of India and ICICI Bank but ownership was broadened in 2007 by selling 5 percent stakes each to international investors NYSE Euronext, Goldman Sachs, General Atlantic Partners and Softbank Asian Infrastructure Fund. It began trading the equities and debt in 1994 and launched futures and options trading in 2000.[2] The popular single stock futures contracts were launched in 2002 while currency futures were added in 2008, followed a year later by interest rate futures.[3]

The NSE handles over twice as many trades as its nearest Indian stock-market rival, the Multi Commodities Exchange (MCX), and over eight times as much as the Bombay Stock Exchange, according to the 2012 Futures Industry Association volume survey.

Key Product

The NSE's S&P CNX Nifty index is owned by the India Index Services and Products Ltd. (IISL), which is in turn part-owned by the NSE. The Nifty benchmark consists of 50 stocks across 21 sectors and represented 62.5 percent of the free float market capitalization of the NSE at September 30, 2009.[4] It has been computed on a free-float basis since June 2009 and total traded value of Nifty stocks for the six months to September 30 was about 54 percent of total stock-trading value on the NSE. On October 14, 2009 the Nifty index closed at 5,118 points - its highest level in 16 months when it closed at 5,157 in May 2008 - as Indian markets continued their sustained 2009 rally.[5]

Key People

Contract Volume

Year Total Annual Volume* Percent Change World Ranking
2012 2,010,493,487 (-) 8.6% 3
2011 2,200,366,650 (+) 36.2% 5
2010 1,615,790,692 (+) 75.9% 5
2009 918,507,122 -- --

Latest News

NSE entered into a significant cross-listing partnership with the CME Group, the world's largest derivatives-exchange operator, in March of 2010, involving benchmark stock indexes in the two countries. Futures contracts on the NSE's benchmark S&P CNX Nifty Index (better known as the Nifty 50) are listed on CME Group, denominated in local currency.[6] In return, the NSE lists the CME Group's S&P 500 and Dow Jones Industrial Averages stock index contracts, denominated in Indian rupees. The contracts commenced trading on July 19, 2010 along with two new contracts as part of its NSE partnership, the E-mini and E-micro S&P CNX Nifty (Nifty 50) futures.[7]

In July 2010, the exchange launched the India Volatility Index (India VIX) on a real-time basis; it previously only tracked end-of-the-day changes. India VIX is based on the index option prices of the benchmark Nifty. On July 19, 2010 NSE applied with SEBI to start futures and options on the index, after it has been tracked for a suitable period.[8]

References

  1. 2010 Annual Volume Survey. Futures Industry.com.
  2. The Organisation. National Stock Exchange of India.
  3. Proposed stock exchange set to challenge NSE’s near-monopoly. Livemint.com.
  4. S&P CNX Nifty. NSE.
  5. Nifty, Sensex at new peak, end near 17-month highs. NDTV.
  6. National Stock Exchange of India and CME Group Announce Cross-Listing Relationship. PRNewswire-FirstCall.
  7. Press Release. NSE.
  8. Press Release. NSE.