Capital markets regulator SEBI has permitted stock exchanges with commodity derivative segment to introduce futures on indices.
The stock exchanges, willing to start trading in futures on commodity indices, are required to take prior approval for launching such contracts, SEBI said in a circular.
“Exchanges will have to submit at-least past 3 years data of the index constructed along with data on monthly volatility, roll over yield for the month and monthly return while seeking approval from Sebi,” the circular added.
Constituent futures contracts should be in existence on the respective exchange for at least previous twelve months, and should have traded for at least 90 per cent of trading days in last twelve months and have a minimum average daily turnover. The turnover should be at least Rs 75 crore for agricultural and agri-processed commodities, and Rs 500 crore for all other commodities, SEBI said.