Addressing an analyst meet on Monday, BSE chief executive (derivatives) Manoj Vaish said, ``Ten membership were given by the BSE last week and of these, three members have already started trading.'' This is for the first time that the BSE has offered select membership for the derivatives market. At the time of starting derivatives trading in June, only the BSE members were allowed to have the membership of the derivatives segment.

``With this new intiative, we expect increase in the derivatives trading volumes, which has ranged between Rs 12-15 crore per day,'' Dr Vaish said.To become a limited trading member, individual/companies should have a minimum networth of Rs 50 lakh. In addition, Rs 3 lakh has to be deposited as one-time charge and an additional Rs 1 lakh as processing fee to the exchange. Dr Vaish also stated that in view of the low trading volumes on the derivatives market, the BSE is also planning to have an extended trading time especially for this.

The first initiative in this regard has already been taken by the BSE with derivative market opening 30 minutes earlier than the cash market. In the next intiative, the BSE is planning to extend trading for additional three hours after the cash market closes. This is in line with the international market, where the derivatives market have extented timings.

Dr Vaish said the permission of the Securities and Exchange Board of India (Sebi) was not needed for extending the trading time. The BSE has to inform its memnbers in this segment six weeks in advance regarding this, he said. The BSE will also be taking up investor education programmes on derivatives and expect the derivatives trading would go up 5-6 fold within 2-3 years. There are lot of bottlenecks at present which has been hindering the growth of the derivative markets, Dr Vaish said. Lack of institutional participatipon to act has hedgers is one of the key factor, he added. But with many mutual funds getting approval to start investing in derivatives, the volumes are expected to grow. In addition, FIIs have also secured approval from the RBI to invest in the derivatives market.