Singapore index steals a march over NSE in Nifty futures volumes in 2021

The Singapore Stock Exchange (SGX) has beaten the National Stock Exchange of India (NSE) in average volumes in Nifty futures trading this year, trading data showed.

The SGX platform’s total value of contracts traded stood at over Rs 26,000 crore this year: nearly double the daily Nifty futures volumes on the NSE. The average open interest of Nifty futures on the SGX is more than 3 times that of its peer NSE.

Trading in Nifty futures is a common proxy for trading the market as a whole since the index is representative of the market in particular and the economy in general. Nifty futures are essentially futures contracts on the Nifty. The minimum lot size of the Nifty is 75 units or lots.

The SGX Nifty is a derivative of Nifty index and trades on the SGX, one of Asia’s leading stock exchanges. The SGX Nifty has Nifty futures as the underlying and does not have constituent shares. The NSE Nifty has a contract size of 75, with each Nifty futures contract made up of 75 shares.

Trading on SGX commences 2.5 hours before the NSE, which allows foreign funds to set the direction for Indian markets. “This has been happening for years now. We are effectively giving foreigners the power of price discovery that should have been in the hands of foreign players. It does not speak highly of our capital market and the earlier the steps are taken to address this anomaly the better,” said an industry official, on condition of anonymity.

The SGX trades for 16 hours a day while the domestic markets trade for six-and-half hours.