GIFT NIFTY starts trading today

GIFT NIFTY is launched on July 3, 2023, as a replacement for the SGX Nifty, which was previously traded on the Singapore Exchange.

What is Gift Nifty?

GIFT Nifty is a derivative contract of the Nifty 50 index, which is traded on the NSE International Exchange (NSE IX) in Gandhinagar, Gujarat.

The main difference between GIFT Nifty and SGX Nifty is that GIFT Nifty is traded in Indian rupees, while SGX Nifty was traded in US dollars. This makes GIFT Nifty more accessible to Indian investors, who do not have to worry about currency fluctuations.

Another difference is that GIFT Nifty trades for 22 hours a day, from 4am to 2am the following morning IST. This is 6 hours longer than SGX Nifty, which traded for 16 hours a day. The extended trading hours are designed to make GIFT Nifty more attractive to international investors.

GIFT Nifty is cleared by the Singapore Exchange (SGX), which means that trades are settled in US dollars. This is the same as SGX Nifty, and it ensures that investors are protected in the event of a default.

Anyone can trade in GIFT Nifty, including Indian and foreign investors. However, they must first become a member of the NSE IX. To do this, they must meet certain eligibility criteria, such as having a minimum net worth of INR 50 lakhs.

GIFT Nifty is expected to boost liquidity in the Indian derivatives market and attract more foreign investors. It is also seen as a way to promote India as a global financial hub.

What are the advantages of Gift Nifty?

Here are some of the advantages of GIFT Nifty:

  • It is traded in Indian rupees, which makes it more accessible to Indian investors. This is because Indian investors do not have to worry about currency fluctuations when trading in GIFT Nifty.
  • It trades for 22 hours a day, which is 6 hours longer than SGX Nifty. This extended trading hours make it more attractive to international investors, who can trade in GIFT Nifty during their own market hours.
  • It is cleared by the Singapore Exchange (SGX), which means that trades are settled in US dollars. This is the same as SGX Nifty, and it ensures that investors are protected in the event of a default.
  • It is expected to boost liquidity in the Indian derivatives market and attract more foreign investors. This is because GIFT Nifty is a more convenient and accessible way for international investors to trade in Indian equities.
  • It is seen as a way to promote India as a global financial hub. The launch of GIFT Nifty is a sign that India is committed to developing its financial markets and attracting foreign investment.

Overall, GIFT Nifty is a more accessible and convenient way for Indian and international investors to trade in Indian equities. It is expected to boost liquidity in the Indian derivatives market and attract more foreign investment. This will be beneficial for the Indian economy as a whole.

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