NSE Receives CFTC Approval To Sell Its Products To US-Based Investors

Posted By:
Subscribe to GoodReturns
For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

    The National Stock Exchange (NSE) has received a go-ahead from the US equity and commodity derivatives regulator CFTC or Commodity Futures Trading Commission to sell its products to investors based out of the US. With this approval in place, the institutional investors in the US will be able to trade in derivative listed on the NSE with no restrictions.

    NSE Receives CFTC Approval To Sell Its Products To US-Based Investors

    The institutional investors in the US can trade only in derivatives that have the approval from the CFTC. Hence, this development will likely boost inflows into the derivatives market in India from institutional investors based out of the US.

    In an earlier instance till last year, these funds took the promissory note route for trading in Indian futures as this was not deemed as direct exposure to the futures market in India. But as the SEBI decided to ban p-note participants from taking unhedged position, these funds were left with no option to trade in single-stock futures.

    Investors from the US willing to trade in index futures are also not providing the avenue as both the NSE and BSE have ended their arrangement of data sharing with offshore bourses. Consequently such investors take exposure in offshore avenues such as Singapore Exchange (SGX). To this effect, SGX nifty accounts for over half of the index derivatives volume.

    Market participants view this approval by CFTC to be a good deal for Indian derivatives market as it may attract an increasing number of hedge funds.

    Goodreturns.in

    Story first published: Friday, May 18, 2018, 15:14 [IST]
    Company Search
    Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

    Find IFSC

    We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more