Starting from July 3, 2023, the Singapore Exchange (SGX) will fully transition its SGX Nifty derivatives contracts to the National Stock Exchange of India (NSE) IFSC - SGX Connect. As per the circular issued by SGX to its market participants, the transition will result in the suspension of trading for SGX Nifty after the T session on June 30, 2023. All US dollar denominated Nifty derivatives contracts will be exclusively traded on NSE IFSC after the transition.
SGX will migrate all open positions in SGX Nifty to NSE IFSC Nifty for those who do not close their positions before June 30, 2023. The SGX Nifty will be delisted later, pending regulatory approval.
The conversion ratio for SGX Nifty positions to NSE IFSC Nifty positions will be 1:1. The liquidity switch will be performed over the weekend after June 30, 2023, and relevant clearing and position transfer fees will be waived by SGX. The trading sessions and timings for NSE IFSC Nifty will remain the same.
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Thanks and Regards
This is big news for USDINR!!
What would be the implications of this? What are the pros and cons?
I don’t see any cons on this. However, pros could be:
- SGX NIFTY will be now commonly called NSE IFSC Nifty or IFSC Nifty.
- The trading holidays applicable will be those observed in India and set by IFSC, which currently number three, compared to Singapore’s approximately ten.
- This will enhance liquidity in IFSC, leading to greater foreign participation in other derivative products offered by IFSC.
- NSE-IFSC has collaborated with SGX via SGX-Connect to allow SGX traders to conduct trades on IFSC. Similar partnerships may be formed with other global exchanges in the future.
Can an individual Resident/ Non Resident - Will be able to trade at NSE IFSC ? If yes, Any reference link for the procedure, etc. ?
Couldn’t find anywhere on the google.
Hi @dhimant unfortunately No.
As per RBI guidelines, you cannot buy USD to trade in any derivative contracts. It is mainly for the NRIs and FPIs.
Hi Shrimohan, Thanks for the quick response.
While I am a NRI, and possess some family resident account as well.
So being a NRI, I can trade right ? If yes, any links for the detailed reference information like how to open an Account for trading, etc. Apologies, but couldn’t find any so.
Hi @dhimant anytime! Yes being an NRI you can trade in IFSC. You need to open an account with an IFSC registered Broker. We have also setup a subsidiary in GIFT City and will start operations there soon. However, exact timelines of this will be subjective, as US markets are in correction mode for a while and also things are just unfolding about the regulations (Trading in Forex has too many hurdles - Right from RBI’s upper cap on LRS to the recently introduced TCS on Remittances). I would recommend you to explore the market depth first over https://www.nseifsc.com/markets/derivatives-watch and then go-ahead with actual trading.
Hey many thanks for the guidance and update.
Looking forward for dhan to offer IFSC Account soon.
The SGX Nifty, a popular trading product at the Singapore Exchange, will cease operations later this month and rebrand as GIFT Nifty. Starting from July 3, trading will be conducted for nearly 21 hours per day at GIFT IFSC in Gujarat.
Injeti Srinivas, Chairman of the International Financial Services Center Authority (IFSCA) at GIFT IFSC, announced the rebranding and explained that the entire trading volume of SGX-Nifty will shift to GIFT IFSC from June 30. GIFT Nifty will encompass four derivative contracts: GIFT Nifty 50, GIFT Nifty Bank, GIFT Nifty Financial Services, and GIFT Nifty IT.
The transition process, initiated by Prime Minister Narendra Modi in July 2022, will be fully implemented on July 3. The collaboration between NSE IX and SGX enables GIFT Nifty orders from SGX members to be routed to NSE IFSC for trading and execution, with clearing and settlement through SGX derivatives clearing.
Trading will occur for approximately 21 hours, starting when the Singapore Exchange opens at 6:30 am, and will be divided into two sessions that overlap with Asia, Europe, and US trading hours. Ashishkumar Chauhan, MD & CEO of NSE, assured that the shift will not affect traders using SGX, as they can continue placing orders as usual.
IFSCA Chairman Srinivas highlighted efforts to increase international participation in the Indian capital markets through initiatives such as sponsored and unsponsored depository receipts. These initiatives aim to enhance transparency and visibility in India’s capital markets, potentially leading to a shift from Participatory Note to the Depository Receipts route for foreign investors.