Even though the process is in the preliminary stages but the oldest bourse in Asia wants to have a lead in the derivatives segment and does not want to loose over its rival exchanges.

Speaking to The Financial Express, BSE Derivative segment CEO Dr Manoj Vaish said: "After index futures and options, the next derivative products would be interest rate futures and currency futures,". These products will come up gradually with the picking up of trade in derivatives.

Derivatives committee appointed by Sebi in its report had suggested that after the success of equity derivatives, other derivatives products in the financial market should be launched in consulation with Reserve Bank of India (RBI).

The exchange has to get Sebi and Reserve Bank of India (RBI) permission prior to such a launch. "Since Interest Rate Swap (IRS) and Foreign Currency Swap (FCS) are products most popular with the banks around the world, the advent of futures in these categories are likely to suit better as derivative products in the bourse," Dr Vaish said.

Meanwhile, the exchange has almost prepared its software to go for the fulfledged index options by November and is waiting for the market regulator to come out with a circular for the various guidelines to be followed by the stocks exchanges and market participants.

The back office softwares for the brokers are also ready. The derivative segment is working reasonably well and there has been a good price discovery.

Presently the trading activity in the derivative segment is basically confined to retail players, mainly brokers. Of the 130 brokers registered with the BSE derivative segment, 97 are active brokers. The domestic financial institutions are also planning to venture into the derivative market. Presently ICICI is the lone financial institution. Recently Industrial Development Bank of India (IDBI) has got the approval to trade in derivatives. This is to be followed by Industrial Finance Corporation of India (IFCI) and the Unit Trust of India (UTI).

The mutual fund sector is also planning to enter but they need prior approvals from their trustees. The BSE derivative segment is also carrying out an investors awareness programme. It had already carried out seminar presentations in 18 cities around the country.