NSE, BSE to launch F&O contracts in Cadila, Bharti Infratel

The BSE and the National Stock Exchange (NSE) will introduce six companies, including Cadila Healthcare and Bharti Infratel, to the futures and options (F&O) segment from Monday. Besides, Marico, NCC, BEML and TV18 Broadcast will also become part of the derivatives segment.

"F&O contracts on these six additional securities would be available for trading with effect from September 28," the exchanges said in circulars. Currently, there are about 200 securities available for trade in the F&O segment.

According to exchange rules, for a stock to be eligible, the median-quarter sigma order size (the value size of an order needed to cause a change in the stock price) should not be less than Rs 10 lakh through the past six months. Also, the market-wide position limit for the stock should be at least Rs 300 crore and the stock has to be part of the top 500 in terms of the average daily market capitalisation.

Shares of all the six companies that were added to the F&O segment outperformed the market on Thursday. Shares of TV18 Broadcast gained the most, at 6.3 per cent, followed by NCC (four per cent). Addition to the F&O segment boosts traders' interest in a stock and improves liquidity, experts say. Investors also use F&O segment to hedge positions in the cash segment.

In May, the exchanges had added 14 stocks to the F&O segment.