The National Stock Exchange has announced that the pre-open session will be held for the Futures & Options (F&O) category as well.
Starting December 8, the Pre-Open session will be held from 9 AM to 9:15 AM, the NSE said in its circular. The pre-open session will be applicable for both single stocks and index futures in the equity derivatives market.
“This is a welcome move and will help in better price discovery. Initially, they are starting it with the current month futures contract,” said Vipin Kumar, Assistant Vice President of Technical and Derivatives Research at Globe Capital.
The pre-open will apply exclusively to the futures contracts of the current month for both individual stocks and indices. However, in the last five trading days before the current month’s expiry, this session shall be extended to the next month’s futures contracts.
In what cases pre-open session will not be applicable?
The NSE, through its circular, stated that if there is a Spread & Option contract on indices and stocks. Also, if there’s a futures of an underlying security on its ex-date of corporate action due to the scheme of arrangement.