NSE, USE get SEBI nod to commence trading

National Stock Exchange and United Stock Exchange of India have received approval from the Securities and Exchange Board of India (SEBI) to commence trading in currency options, said officials from the exchanges. USE received the approval from SEBI on Tuesday, while NSE received it on Monday. USE is set to begin its operations very soon once it has complied with all the guidelines laid down by SEBI, said its statement. The options will be introduced on the USD-INR spot rate with three each in ‘In The Money', ‘Out Of The Money' options, and one in the ‘Near The Money' option. USE began its currency futures operations three weeks back recording volumes of Rs. 45,845 crore on the launch day.

“Currency Options on USE provides a very powerful mechanism for corporate entities and SMEs to hedge their currency and at the same time bringing in all the benefits of exchange traded products like transparency and efficient price discovery,” said Mr Madhu Kannan, Managing Director and CEO of BSE, which is the largest single shareholder in United Stock Exchange, holding a stake of 15 per cent. Reacting to the approval given by SEBI to both USE and NSE, MCX-SX said this in a statement, “As usual, SEBI did not communicate anything on our applications dated (31 July 2010), (20 Aug 2010) and (24 Aug 2010) for introduction of currency options on our Currency Derivatives segment.”