Sensex futures and options on Eurex from October 4

Bombay Stock Exchange and leading European derivatives exchange Eurex on Wednesday said they would launch the Sensex futures and options on the Frankfurt-based bourse from October 4.

The new contracts will be denominated in U.S. dollars and settled in cash. The futures will have maturity dates of three nearest months, and the following March, June, September and December, the two bourses said in a joint statement here.

“We are very pleased to be working with Eurex to develop a broader international investor base focused on the Sensex. The Sensex will now be trading during a larger portion of the global trading day, which will increase its appeal and value,” BSE managing director and chief executive Madhu Kannan said.

“Moreover, we see growth of overseas liquidity in the Sensex as helping us to broaden and deepen the market for Sensex products within the country,” Mr. Kannan added.

Two market-making schemes will be in effect until the end of December 2011 — one to support liquidity during the overlap of Indian and European trading hours, and the other for the European market hours.

The expiry dates of the options will be in the three nearest calendar months, the next three quarters and two next semi-annual expiries.

“By introducing futures and options on this prominent benchmark, we also will advance our efforts in the Asia-Pacific region by creating trading opportunities for customers seeking access to this fast-growing emerging economy,” Eurex executive board member Peter Reitz said in the statement.

Eurex is one of the world’s leading derivatives exchanges and is jointly operated by the Deutsche Borse and SIX Swiss Exchange. Eurex offers a broad range of international benchmark products and operates the most liquid fixed income markets in the world, featuring open and low-cost electronic access. Trading volume on the Eurex is over 1.5 billion contracts a year.

The Sensex tracks the daily performance of 30 of the largest and the most actively traded companies listed on the BSE, the oldest bourse in Asia.