The introduction of trading in interest rate futures in India is one more
step towards integration of the Indian Securities Market with the rest of
the world. We all are familiar with forward contracts. They are essentially
over-the-counter (OTC) contracts traded on one to one basis among the parties
involved, for settlement on a future date. The terms of these contracts
are decided by the parties mutually at the time of their initiation. If
a forward contract is entered into through an exchange, traded on the exchange
and settled through the Clearing Corporation/ House of the exchange, it
becomes a futures contract. As one of the most important objectives behind
bringing the contract to the exchange is to create marketability, futures
contracts are standardized contracts so designed by the exchanges as to
ensure participation of a wide range of market participants. In other words,
futures contracts are standardized forward contracts traded on the exchanges
and settled through their clearing corporation/house. Introduction of Interest
Rate Futures is an excellent example of collaborative efforts on the part
of market participants, exchanges and regulators. It is a great addition
to the existing portfolio of financial products in the Indian Financial
Markets.
Product
Currently BSE’s Interest Rate Derivative Segment offers
- 91-day Government of India (GOI) Treasury Bill Futures (w.e.f. November 29,2013)
- 10 Year Government of India Futures (w.e.f. January 28, 2014)
Contract Specification
Master Circular for Trading in BSE Interest Rate Derivatives ContractsClick here