banknifty options

Bank Nifty represents the 12 most liquid and large capitalized stocks from the banking sector which trade on the National Stock Exchange (NSE). It provides investors and market intermediaries a benchmark that captures the capital market performance of Indian banking sector.
banknifty options
The Bank Index commonly known as “NIFTY BANK” was launched by India Index Service and Product Limited (IISL) in the year 2000. It provides investors and market intermediaries a benchmark that captures the capital market performance of Indian Banking sector.

Nifty Bank Index is computed using free float market capitalization method with base date of Jan 1, 2000 indexed to base value of 1000, wherein the level of the index reflects total free float market value of all the stocks in the index relative to a particular base market capitalization value. The method also takes into account constituent changes in the index and importantly corporate actions such as stock splits, rights, new issue of shares etc. without affecting the index.
Futures contracts on Nifty Bank Derivatives was launched on June 13, 2005. Nifty Bank derivatives contracts based derive it value from the underlying index. Futures and Option contracts are also available on all the underlying stocks constituting Nifty Bank.

BANKNIFTY options contracts expire on the last Thursday of the expiry month. If the last Thursday is a trading holiday, the contracts expire on the previous trading day.
BANKNIFTY options contracts have a maximum of 3-month trading cycle – the near month, the next month and the far month. A new contract is introduced on the trading day following the expiry of the near month contract.

CNX Bank Index represent about 14.66% of the free float market capitalization of the stocks listed on NSE and 84.66% of the free float market capitalization of the stocks forming part of the banking sector universe as on June 30, 2011.

The total traded value for the last six months of all the CNX Bank Index constituents is approximately 14.11% of the traded value of all stocks on the NSE and 82.90% of the traded value of the stocks forming part of the banking sector.

Banknifty stock options are index options and as compared to nifty options has higher volatility range. So traders must have strict risk management rules while trading in banknifty futures as well as options.

The Author

Pramod Baviskar

Professional Market Trader And Owner Of Dalal Street Winners Advisory And Coaching Services. Working Since 2007 And Online Presence Since 2010. We Provide Highly Accurate And Professional 1 Entry And 1 Exit Future, Option, Commodity, Currency And Intraday Stock Tips On Whatsapp With Live Support And Follow Up.
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