market for two years in India for the future of the coin is growing faster than the stock

market for two years in India for the future of the coin is growing faster than the stock after attracting individual investors transaction costs are almost 50 percent less.

The average volume of betting on the value of the rupee at a future date rose more than three times this year to $ 3.2 billion per day on the National Stock Exchange of India Ltd., which had the contracts in September 2008. the average daily turnover in the capital ten years ago the derivatives market rose 56 percent to $ 22 billion, according to the website of the bag.

"Currency trading can be a thriller," said Aarukettil Krishnankutty Sugunan, a glass of 61-year-old plywood trader based in the southern Indian city of Kochi. "Broker fee amounts and the margin is very low on rupees, and that allows me to make bigger bets."

Investors are moving into the future as the median forecast of 16 analysts shows the rupee will rise 2.2 percent in late March, surpassing the most actively traded currencies in Asia, except South Korea won, Philippine peso and the Malaysian ringgit. one-month volatility, a measure of fluctuations in the exchange rate used to price options, is the second highest in the region at 9.7 percent, increasing the range of operators to make a profit.

The rupee's 2.9 percent gain this year was driven by the influx of foreign investors seeking to benefit from increased performance of the nation. three years in India yield government bonds of 7.37 percent is the highest among major economies, except Brazil, where similar notes maturing pay 12.65 percent. Comparable values available in China 3.26 percent and 7.10 percent in Russia.

Geojit BNP Paribas Financial Services Ltd., a brokerage firm partly owned by France's biggest bank, charges 200 rupees (4.40 dollars) in respect of an investment committee of the exchange rate of 1 million rupees, compared with 385 rupees for stock futures.

Low margin requirements

The brokerage requires individuals to put a 3 per cent of planned investment rupee futures, known as margin payments, compared with at least 10 percent of equity derivatives. Rupee derivatives are also exempt from a tax on securities transactions applies to all other publicly traded securities, RG Renjith, the Mumbai-based head of sales in Geojit BNP Paribas, said in an interview on 16 December.

"It's much easier for short-term traders to enter and exit the currency futures due to lower margin requirements," said Renjith. "The absence of a tax on transactions helps to reduce the rate of passage."

Derivatives are contracts whose value is tied to assets such as stocks, bonds, commodities and currencies, or events such as changes in interest rates or the weather.

India's currency was more in the world are traded in futures markets in the first half of 2010, followed by the dollar and the euro, according to the Washington-based Association Futures Industry.

Investment inflows

The rupee has appreciated 1.7 percent against the dollar this month, the biggest gain after the Taiwan dollar among the 10 most traded currencies in Asia. The currency rose 0.5 percent to 45.23 per dollar today.

The ten-year bond rose today. The yield of 7.80 percent bonds due May 2020 fell five basis points, or 0.05 percentage point to 7.92 percent as of 12:34 pm in Mumbai, according to the Bank's trading system Central.

Government Bonds

government bonds in India returned 5 percent this year compared with 1.5 percent earned on the debt of China, according to indexes compiled by London-based HSBC Holdings Plc. Global investors have invested a record 38 billion U.S. dollars this year in stocks and bonds of the third largest economy in Asia, data from the Securities and Exchange Board of show India.

Swaps credit-default in the State Bank of India, the country's largest lender, have fallen 21 basis points this month to 158, according to data provider CMA. The swaps pay the buyer face value in exchange for the underlying securities or the cash equivalent if a government or a company fail to adhere to its debt agreements.

Fighting Risk

The entries have pushed up the implied volatility of options dollar rupees a month to an average of 11 percent since early 2008, compared with 5.2 percent in the last three years.

The jump in the volatility of the rupee has increased the need for a wide range of tools to protect themselves from adverse fluctuations in the exchange rate, Divya Malik Lahiri, a spokeswoman for the National Stock Exchange, said in an interview on 16 December.

"The rupee futures have been very useful in the fight against foreign exchange risk in the commodity trade," said Salu Cholayil Kuriakose, a coffee trader 38 years of age, based on Sultan Bathery in the southern state of Kerala, with exports to Belgium and the United Kingdom, December 3. interview. "We just do not have access to cost effective and practical means for risk mitigation previous exchange rate."

Options contracts signal investors have become more optimistic on the rupee. The premium paid for the options it offers protection against a possible decline in the currency in one month fell to 180 basis points today from 220 on 30 November.

"Exceeded expectations"

The risk-investment rate of the call was 150 for the Russian ruble and 315 basis points for the Brazilian real. The extent of China was negative in five points, ie, investors are more pessimistic about the dollar than the yuan.

Futures exchange rates have grown in popularity in India after the company suffered losses on derivative contracts as the financial crisis of 2008 generated increased exchange rate movements. Hong Kong brokerage CLSA Ltd. estimated the same year that the nation's businesses would lose $ 4 billion in derivatives.

Apart from the National Stock Exchange, the rupee futures traded on a number of commodities of India Ltd., Bombay Stock Exchange three months and U.S. stock market. The Mumbai-based exchanges offer contracts to trade in India's foreign currency against the dollar, the euro, sterling and yen.

"The growth in currency futures has far exceeded all expectations," Lahiri said National Stock Exchange. "The participation of Retail will increase with more awareness."