An interesting development that has not been adequately analysed in this rally, is the impact of derivatives trading on the volatility of stock prices. Derivatives trading turnover in India is already more than twice that of the cash market. For instance, the National Stock Exchange, which accounts for most of the derivatives trading in the country, showed an equity turnover of Rs 4,722 crore while its derivatives volume was a huge Rs 9,878 crore. On several days, the NSEs derivatives volume has been above Rs 10,000 crore. However, the cash market turnover comes from 800 scrips traded everyday, while the massive derivatives turnover is from just 41 scrips with an option of three or more contracts each. This would explain the high level of interest in the segment. Some analysts believe that although derivatives have allowed market operators to speculate with lower risks and to hedge their cash market positions more effectively, it has also increased market volatility in leading market favourites. They also believe that the impact of positive and negative market developments tend to be magnified by the derivatives trade, because they have a higher weightage in leading stock indices. It is not clear if this would be borne out by statistical testing. But so far, derivatives trading has proved a highly positive development, by providing better and safer opportunities for speculation.