BANK NIFTY WEEKLY OPTIONS

NATIONAL STOCK EXCHANGE OF INDIA LIMITED

DEPARTMENT : FUTURES & OPTIONS

Download Ref No : NSE/FAOP/32329

Date : May 05, 2016

Circular Ref. No : 044/2016

All Members,

Introduction of Weekly Options contracts on BANKNIFTY Index

Exchange is pleased to inform members that with reference to approval received from SEBI, Weekly Options contracts on BANKNIFTY Index shall be made available for trading in Future & Options segment w.e.f. May 27, 2016.

The relevant information about the weekly options contracts are as given below:

Annexure – 1: Contract Specifications

Annexure – 2: The weekly options contracts available for trading from May 27, 2016 onwards.

The settlement procedure and details shall be intimated separately by NSCCL.

Members may note that there is no change in the structure of any of the reports.

The contract.gz file made available to trading members on the NSE Extranet (Path: /faoftp/faocommon) from May 26, 2016 end of day will reflect the new weekly options contracts. Further, members are advised to load the above file in the trading application before trading on May 27, 2016.

For and on behalf of

National Stock Exchange of India Limited

Khushal Shah

Chief Manager

	Toll Free No	Fax No	Email id
	1800-266-00-53	+91-22-26598449	fotrade@nse.co.in
	Regd. Office : Exchange Plaza, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051			Page 1 of 2

Annexure – 1

Contract Specifications

The Exchange hereby notifies the following for Weekly Options contracts on BANKNIFTY Index.

Instrument Name	OPTIDX
Symbol	BANKNIFTY
Expiry date	Every Thursday of the week. In case the Thursday is a trading
	holiday, the previous trading day shall be the expiry/last
	trading day. All contracts shall expire at the normal market
	closing time on the expiry day or such other time as decided
	by Exchange.
Contract cycle	7 weekly expiry contracts excluding the expiry week of
	monthly contract
	New serial weekly options contract shall be introduced after
	expiry of the respective week’s contract.
Contract Size	30 units for all expires of the month of June 2016 and
	40 units for all expires from the month of July 2016

Note: All other contract specifications shall be in line with the monthly expiring BANKNIFTY options contracts.

Annexure – 2

The following weekly options contracts shall be available for trading from May 27, 2016 onwards

SR NO	INSTRUMENT	SYMBOL	EXPIRY DATE
1	OPTIDX	BANKNIFTY	02-Jun-16
2	OPTIDX	BANKNIFTY	09-Jun-16
3	OPTIDX	BANKNIFTY	16-Jun-16
4	OPTIDX	BANKNIFTY	23-Jun-16
5	OPTIDX	BANKNIFTY	07-Jul-16
6	OPTIDX	BANKNIFTY	14-Jul-16
7	OPTIDX	BANKNIFTY	21-Jul-16

Regd. Office : Exchange Plaza, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051

Page 2 of 2

BSE WEEKLY OPTIONS FAQ

1. What are Weekly Stock and Index Options?

Exchange Traded Options based on a Stock or Index with shorter maturity of one or more weeks are known as Weekly Options.

2. What is the last trading day / expiration day for weekly options contracts and how they are generated?

The weekly series contracts expire on Thursday of each week. When the first week series for an underlying for the near week expires, a new weekly option series is generated in the EOD operations of the weekly expiry day. If expiry day of weekly contract coincides with near month contract expiry day then relevant new weekly contract is not generated.

3. How to identify weekly options series?

Nomenclature for Weekly options series:

Format Underlying Series Identifier Week3 Month Option Type Strike Price Total
No of characters 3 characters for Index and 4 characters for Stock 1 1 1 5 digits for Index and 4 digits for stock4 11
Example - For Stock BOSC A 9 C 7000 BOSCD9C7200
Example - For Sensex BSX A 9 C 17000 BSXA9C17000

Month is represented by the single digit as follows:

Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec
1 2 3 4 5 6 7 8 9 O N D

Week is represented by alphabets A-E as follows:

Week 1 Week 2 Week 3 Week 4 Week 5
A            B             C              D   E


4. How are Weekly Options different from Monthly Options?

Weekly Options differ mainly in terms of maturity period. Currently Monthly Options have maturity of 1 month, 2 months or 3 months. As 1 month options expire, another options series get generated. In case of Weekly Options, the maturity will range from 1 week to 5 weeks. Also the nomenclature of weekly and monthly options contracts are different.

5. What will happen if expiry day is a Trading Holiday?

If the expiry day of the Weekly Options falls on a trading Holiday, then the expiry (as per SEBI guidelines) will be on the previous trading day.

6. What are the Similarities between Monthly and Weekly Options?

The parameters viz. Underlying, Contract Multiplier, Tick size, Price Quotation, Trading Hours, Strike price Intervals of the Weekly Options will remain exactly the same as that of Monthly Options.

7. What are the benefits of Weekly Option Contracts?

Weekly Options will command lower premium due to shorter maturity. Thus the Weekly Options will cost less than the Monthly Options.
For similar capital outlay as Monthly Options, participants can take larger positions.
Weekly Options will provide opportunity for Arbitrage between :
"One week to maturity" options and "two week to maturity" options.
Weekly Options and Monthly Options.
On account of low cost, the liquidity will improve, as more participants would come in.
Weekly Options would lead to better price discovery and improvement in market depth.
The market participants would be able to take a short-term view in the underlying also.
Weekly Options would provide market participants short term insurance for their short-term portfolio. This would result in better price discovery and improvement in market efficiency.

8. What are the Risk Management measures taken at the BSE level?

Since the introduction of Weekly Options is just the addition of new series and not a new product as such, the Risk Containment measures adopted for the Weekly Options would be similar to those applied for Monthly Options.

(source :bseindia.com)

Execution Bull call spread on BankNifty April series

Now BankNifty closed at 16278. Due to Global cues more upside expecting on Nifty and Bank Nifty.

I want to execute Bull Call spread on Bank Nifty, Spread is nothing but combination of orders . We can place spread orders on perfect trend with minimum risk and maximum profits.

Short a BankNifty 15600 call at 724.
Long a BankNifty 15500 call at 820.

Total Investment is 95
maximum Profit Potential is 4.33%
Maximum loss Risk is 95

If Return unchanged we can get profit of 4.33%

INDEX OPTIONS : NIFTY Vs BANK NIFTY

Trading on Index Options increased in Indian stock market now a days.
In olden days everyone loves Nifty Index Options because of It's volumes.
When Nifty lot size reduced to 25, then traders looking for alternate. I found Bank Nifty always greater than Nifty. Only problem is volumes, Bank Nifty trade with low volume compare to Nifty. But price movement is always better than Nifty.

Pay per lot traders are not gaining after Nifty's lot size decreased to 25.

Traders who trade with 4 lots on Bank Nifty index options can easily earn 500 to 1500 with sl 500 on

my blog check here

Nifty :

High volumes
lot size : 25
Index movement 30-100 points up or down side.
30 points up or down is equal to premium decrease

Bank Nifty:

Low volumes compare to Nifty
lot size :25
Index movement 50-200 points up or down side.
quick trader always win on Bank Nifty because price movement always faster than Nifty.
Banking stocks are evergreen in Indian stock markets.

Asian markets and SGX Nifty update

Japan markets shut today on account of Health and sports day
KOSPI down -50% now at 1931.20
Straits Times 3211.60 down -0.38%
Taiwan Index 8778.81 -2.09%
SGX Nifty 7825 down -0.65%
Brent crude down -1.86%
NYMX CRUDE down -1.19%

TOP 5 MISTAKES OF OPTIONS TRADERS

1. Buying OTM(out-the-money) calls
2.Entering into Spread trades when 1st trade in loss
3.Ignoring premium depreciation at expiration
4.holding buy calls or puts till expiry
5.Trading in low volume options

NIFTY SHORT STRANGLE

                        SHORT STRANGLE

THIS IS VERY SIMPLE AND EASY  OPTIONS STRATEGY WITH 100% FIXED

MONTHLY INCOME GENERATED STRATEGY.

NOW NIFTY@6715

• SELL NIFTY6300PE

• SELL NIFTY7300CE

IF NIFTY CLOSE BETWEEN 6300 AND 7300 AT THE EXPIRY ,THEN THE BOTH

PREMIUMS WILL BE ZERO YOUR PROFIT IS 100%

WHEN I GO FOR SHORT STRANGLE?

IF YOU EXPECT MINIMUM OR LOW NIFTY INDEX MOVEMENT

SELL 500 POINTS BELOW PUT AND ABOVE CALL FROM CURRENT LEVELS

BEFORE 45 DAY EXPIRY 

TRY TO EXIT AFTER 15 DAYS TO GET MINIMUM 40% PROFIT BOTH SIDES.

AFTER 15 DAYS IF YOU FIND STRONG BULLISHNESS IN NIFTY EXIT 7300CE

AFTER 15 DAYS IF YOU FIND STRONG BEARISHNESS IN NIFTY EXIT 6300PE

IN 15 DAYS THERE ARE 4 WEEKEND HOLIDAYS WHICH KILLS OPTIONS

PREMIUMS

DO PAPER TRADE BEFORE ENTER.. 

WE CAN APPLY TO STOCK OPTIONS ALSO...LIKE

TATAPOWER,NMDC,BHEL,MMTC etc.....  

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