India Index Services and Products Ltd. , a part of the National Stock Exchange (NSE) group, on Tuesday announced the launch of Indian sector - specific index futures on the Singapore Exchange (SGX).
"This is the first time that derivatives on Indian sector indices are being launched outside India, " the two groups said in a statement. The SGX will list four US dollar - denominated index futures contracts based on the Indian exchange's sector indices.
These are the SGX Nifty Bank Index Futures, SGX Nifty IT Index Futures, SGX Nifty CPSE Index Futures and SGX Nifty Midcap 50 Index Futures. The first two will be launched on March 29, followed by the other two in mid - 2016.
"The introduction of sector index futures contracts will deepen SGX's Indian product offering and will provide offshore investors access to specific trading opportunities in the key growth sectors of the world's fastest growing economy, " the statement said.
"Derivatives on these new sector indices will provide useful tools for offshore investors to benefit from these trends and also to manage market movement, " said Chitra Ramkrishna, managing director and chief executive of National Stock Exchange.
SGX's flagship Indian equity derivative product, the SGX Nifty 50 Index Futures, is based on the equity benchmark Nifty 50 Index and is widely used by international market participants to gain offshore exposure to the performance of the Indian equity market.
"Volumes grew 30 percent year - on - year during 2015 to $360 billion. SGX's rupee - dollar futures contract is also SGX's most - active FX futures contract with more than $750 million notional traded per day, " the statement said.
"The continued success of our existing India - linked risk management products is testament to offshore demand from investors to access the India opportunity as well as SGX's ability to pioneer offshore derivative contracts, " said Loh Boon Chye, chief executive of SGX.
Loh said SGX will continue to be innovative in facilitating investor participation in India.