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Get ready to cough up more money to trade in the derivatives segment. The NSE has revised the market lot size of 103 stocks upwards. The revision will take effect from July contracts.
The lot size of Unitech will rise to 99,000 from the current 77,000; Jaiprakash Associates’ lot size will zoom to 68,000 from 48,000.
Besides, the market lot sizes of six indices — Nifty Bank, Nifty IT, Nifty Infrastructure, Nifty PSE, Nifty Midcap 50 and FTSE 100 — have also been revised upwards. While the market lot size of Nifty Bank and Nifty IT have been increased to 40 (from 30) and 50 (from 45) respectively, those of Nifty PSE and Nifty Midcap have been revised to 200 from 150. However, Nifty 50 will continue to have the same lot size of 75.
“Contracts with maturity of May and June would continue to have the existing market lot sizes. All subsequent contracts (i.e. July 2016 expiry and beyond) will have revised market lot size,” NSE said.
SEBI’s earlier moveSEBI last year had increased the minimum contract size in the equity derivatives segment to ₹5 lakh from ₹2 lakh, which had pushed up the lot sizes of many stocks and indices.
The value of a contract is calculated by multiplying the futures price with the number of shares that should amount to ₹5 lakh.
According to Ramesh Chordia, a Chennai-based independent analyst, lot sizes of these stocks got adjusted to meet the SEBI norm on contract size, as the prices of these shares fell sharply this year. For instance, Unitech shares fell about 23 per cent this year while JP Associates crashed 31 per cent.
According to a Mumbai-based analyst, “My sincere advice is that small- and day-traders should keep away from the derivative segment altogether.” He added that those who can afford to take risk should concentrate on Nifty 50 or Nifty Bank index options.
Hind Zinc: ex-dividendMeanwhile, in a separate circular NSE said that the value of Hindustan Zinc in options and futures will be adjusted to reflect the dividend. The company has announced a dividend of ₹24 a share to its shareholders. Adjustment of derivative contracts will be carried out based on the reference rate of the relevant futures contracts on April 5, (last cum-dividend date), the NSE said.
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