“It will only get more competitive from here,” said Maurya Ghelani, derivatives strategist at Kai Securities in Mumbai. “A lot depends on how the BSE responds, and it may have to contend with ceding some ground back to the NSE.”
Derivatives trading accounts for a significant chunk of revenue for both exchanges, with India attracting global quantitative trading firms like Citadel and Jane Street. The NSE has seen a steady decline in its market share in the past year as the securities regulator culled highly traded weekly contracts such as the ones on the NSE Nifty Bank Index, prompting a shift toward options on the S&P BSE Sensex Index.
Since the Securities and Exchange Board of India began its latest curbs to halt the derivatives frenzy, the NSE has struggled to stick to an expiration day. In November, it said it would move it to Thursday for several index derivatives, following BSE’s streamlining of its expiries to Tuesday.
Then in March, the NSE unexpectedly said it would change its expiration day to Monday, putting it ahead of the BSE’s. The move was quickly abandoned as the regulator pushed the exchanges to stick to either Tuesday or Thursday. The news of a new push for a change to Tuesday came last week.