BSE, Asia’s oldest exchange and now world’s fastest exchange with the speed of 6 microseconds, has begun trading in cotton futures contract today, after getting Sebi’s nod to launch the natural fibre on the commodity derivatives exchange.
As part of the launch, BSE organized a bell ringing ceremony at the BSE International Convention Hall, which saw several distinguished dignitaries – Atul Ganatra, President, Cotton Association of India, Arun Sakhseria, Director, Cotton Association of India, Dr P. Alli Rani, Chairman & Managing Director, Cotton Association of India and Pasha Patel, Chairman, Agriculture Price Commission Agriculture Price Commission – grace the event.
The unit of trading for the cotton contract is 25 bales and the deliveries will be tendered in 100 bales. The quotation for cotton futures is in Rs. per bale (of 170 kg). The basic delivery centre for the cotton contracts is Rajkot with additional delivery centres at Aurangabad, Jalgaon Yavatmal in Maharastra and Mundra and Kadi in Gujarat.
Commenting on the launch, Mr. Ashishkumar Chauhan, MD & CEO, BSE said, “With the launch of cotton contracts, we look forward to gain wider participation from cotton business stakeholders. While we began trading in commodities with gold and silver, our focus was to diversify and focus on agri products eventually. Last week, we launched Guarseed and Guargum that has witnessed record turnover and grabbed 36 % market share. We look forward for cotton futures contract to witness a marked rise in terms of volumes and emerge as the most compliant exchange in commodities.”
The contract start day will be the 1st day of contract launch month and the final trading day will be the last day of contract month. The commodity trading session will be from Monday to Friday from 9.00am to 9.00pm. It is a compulsory delivery contract, with the initial margins for the cotton contracts set at minimum 4 per cent or will be based on SPAN, whichever is higher.
BSE (formerly Bombay Stock Exchange) established in 1875, is Asia’s first & now the world’s fastest Stock Exchange with a speed of 6 microseconds. BSE is India’s leading exchange group and has played a prominent role in developing the Indian capital market. BSE is a corporatized and demutualised entity, with a broad shareholder base that includes the leading global exchange- Deutsche Bourse, as a strategic partner. BSE provides an efficient and transparent market for trading in equity, debt instruments, equity derivatives, currency derivatives, interest rate derivatives, mutual funds and stock lending and borrowing.
BSE also has a dedicated platform for trading in equities of small and medium enterprises (SMEs) that has been highly successful. BSE also has a dedicated MF distribution platform BSE StAR MF which is India Largest Mutual Funds Distribution Infrastructure. On October 1, 2018, BSE launched commodity derivatives trading in delivery-based futures contract in gold (1 kg) and silver (30 kg).
BSE provides a host of other services to capital market participants including risk management, clearing, settlement, market data services and education. It has a global reach with customers around the world and a nation-wide presence. BSE’s systems and processes are designed to safeguard market integrity, drive the growth of the Indian capital market and stimulate innovation and competition across all market segments.
Indian Clearing Corporation Limited, a wholly owned subsidiary of BSE, acts as the central counterparty to all trades executed on the BSE trading platform and provides full novation, guaranteeing the settlement of all bonafide trades executed. BSE Institute Ltd, another fully owned subsidiary of BSE runs one of the most respected capital market educational institutes in the country. Central Depository Services Ltd. (CDSL), associate company of BSE, is one of the two Depositories in India.