Mumbai, Jan. 8
One week of extended trading hours has not translated into any significant increase in traded volumes on the stock exchanges.
Since Monday, the first day of a 9 a.m. opening for the exchanges, the average daily volumes in the Futures & Options segment on the NSE over the week have been in the region of Rs 50,000 crore; down from the December daily average of Rs 72,000 crore.
The cash segment on the exchange registered higher volumes - averaging Rs 17,572 crore daily for the week currently ended, against Rs 13,948 crore for December.
However, the cash segment accounts for a smaller proportion of the exchange turnover; also, the growth in this segment has nothing to do with extended trading hours, said analysts.
It is to do with the significant shift in investors' interest to the medium-sized companies, and away from the large ones, said Mr Alex Mathew, Head of Research at Geojit Financial Services.
"As the larger scrips are beginning to looks expensive, investors are shifting to the medium-sized companies, which is why the volumes traded in the F&O segments have dropped as many of the smaller scrips are not in the derivatives segment," he said. "Nothing has changed with the extension of market timings."
Market-men said they were not expecting any big increase in volumes anyway. "The change in trade timings does not seem to have served its purpose," said Mr Arun Kejriwal from research and information company KRIS.
"Firstly the price discovery, which was happening on the Singapore stock exchange, still has not changed as that market still opens ahead of the Indian markets," he added.
The purpose of countering the arbitrage opportunity in the Singapore markets also might not work as the trading margin on the product there is 10 times less than in India, and investors would still prefer the Singapore market, Mr Kejriwal said.
Some of the retail investors that Business Line spoke to also said the change in market timings has in no way altered their activity on their bourses. "I will trade when I have to, and that is at around three in the afternoon. That is when all the action starts as the European markets open then," said Mr Jason D'Souza, a regular stock market player.
Another, retail investor, Mr. Ravi B, from Kolkata, also said his buy and sell orders would be placed at 3-3.30 p.m. regardless of any trade timing changes. Brokers said this was a common practice among not only retail investors, but also high net worth and institutional investors, that they enter the market in the last hour of trade
Happy Trading,
United we grow!!!
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