The National Stock Exchange (NSE) has changed Bank Nifty Futures and Options (F&O) expiry day to Friday from Thursday earlier. The change will be effective from trade date July 7, 2023, Friday
As per the NSE circular, all existing contracts with Thursday expiry will be revised to Friday on Tuesday, July 6, 2023, EoD. The first Friday expiry will be on July 14, 2023
At EoD today, the expiry date and maturity date for all existing futures and options contracts expiring or maturing on July 13, 2023 (Thursday) will be postponed to July 14, 2023 (Friday)
For contracts with expiry/maturity date on the last Thursday of the month i.e. August 31, 2023 (Thursday), the expiry date will be preponed to August 25, 2023 (Friday) of the respective current expiry month
All existing weekly F&O contracts shall now expire on Friday of every week. If Friday is a trading holiday, then the expiry day is the previous trading day
All monthly and quarterly F&O contracts will expire on the last Friday of the respective contract month. If Friday is a trading holiday, then the expiry is the previous trading day
According to NSE, any new contract created for trading on or after EOD of July 06, 2023, shall be created as per the revised expiry days. There is no other change in the existing contracts specifications of Bank Nifty
The settlement schedule shall be intimated separately by Clearing Corporations, NSE said in its circular, adding that revised contracts shall be available for trading from July 07, 2023
With the latest change, NSE will now have an F&O expiry on every day of the week barring Monday, with effect from the week starting July 9. There is the Nifty Financial expiry on Tuesday, Nifty Midcap Select on Wednesday, Nifty 50 on Thursday and now Bank Nifty on Friday.
Earlier this year, in an effort to boost derivative trading in Sensex and Bankex indices, which have been overshadowed by Nifty and Nifty Bank, BSE tweaked the lot size and expiry day of the F&O contracts. According to Siddarth Bhamre, Head Of Research at Religare Broking, revision of Bank Nifty F&O expiry day to Friday is the first time NSE has acted in response to a move made by BSE.
NSE's decision can be viewed from two perspectives, according to Santosh Meena, Head of Research, Swastika Investmart Ltd. First, to counter competition from BSE. "Second, NSE's previous successful experiment with the Finnifty's new expiry day may have influenced this decision," he said, adding that expiry alone may not be the sole factor determining attractiveness.
As per Siddarth Bhamre of Religare Broking, the move to shift Bank Nifty expiry to Friday is a win-win situation for NSE since not only will it counter competition from BSE, but it will also result in high volumes on the exchange on both Thursday and Friday. For traders, this expiry date revision means more investment opportunities in a week.
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