The Calcutta Stock Exchange (CSE) board plans to finalise a decision on a suitable derivatives trading vehicle within this week and the CSE top brass has convened yet another meeting today on this issue. This follows the derivatives interface on Saturday, December 11, with CMIE's Ajay Shah.
According to Suresh Jalan, vice-president, CSE, "We are keen on arriving at a firm decision this week, having already lost enough time on the matter. The sooner we are able to decide how we would like to get into derivatives, can we then put the proposal up for members' approval and start talking to software providers."
Three options are being considered by the bourse at this juncture, said Jalan. The exchange would either go in for a separate and independent subsidiary, or incorporate the derivatives module into the existing market system or move jointly with the other regional exchanges.
The CSE brass has clearly decided to attach priority to its independent initiative in derivatives rather than go with the Delhi Stock Exchange and other regional bourses, and this was obvious from the fact that the top brass was in Calcutta on Saturday to host Ajay Shah, instead of attending the meeting of bourse chiefs under the Federation of Stock Exchanges (FISE) banner on the same issue.
According to Jalan, once the bourse is able to decide on the vehicle, it might even bring in a foreign consultant to assist and advise the move into derivatives. However, first the approval of the members have to be secured and this we can do once the board can come to an firm decision informally first, he emphasised.
Earlier, CSE president J M Choudhary made it clear that exchange was undertaking a detailed exercise on derivatives but had not yet thought about whether it would be part of the national initiative under FISE. Choudhary's and the board's general attitude seems to indicate that CSE is not attaching much importance to the FISE plans.
"Whether we join them or whether they join us, is all the same thing. Let us get together our strategies first, then we will think of the national initiative," Choudhary said.
