NSE to launch weekly options contracts on Bank Nifty index

Leading stock exchange NSE today said it will introduce weekly options contracts on Bank Nifty index from May 27.
The decision comes after receiving approval from markets regulator Securities and Exchange Board of India (Sebi).
"The exchange is pleased to inform members that with reference to approval received from Sebi, Weekly Options contracts on Bank Nifty index shall be made available for trading in Future & Options segment with effect from May 27, 2016," National Stock Exchange said in a circular.
It said that Bank Nifty contracts will expire on the every Thursday of week. In case, Thursday is a trading holiday, the contracts will expire on the previous trading day.

"All contracts shall expire at the normal market closing time on the expiry day or such other time as decided by exchange," the bourse said.
A futures contract is a forward contract, which is traded on an exchange, while an option contract gives a person the right but not the obligation to buy or sell something.
An option is a contract between two parties wherein the buyer receives a privilege for which he pays a fee (premium) and the seller accepts an obligation for which he receives a fee.