Informist, Tuesday, Sept. 2, 2025

By Rajesh Gajra

NEW DELHI – The first-ever expiry of Nifty 50 weekly options on Tuesday saw the total index options volume rise by 21% on the National Stock Exchange from the average expiry day volume in August. Until last month, expiry for weekly and monthly index options took place on Thursdays.

Tuesday, the number of index options contracts traded on the NSE were 361.3 million, of which around 303.80 million contracts were of Nifty 50 options that expired Tuesday. In August, on Thursdays, the number of index options contracts ranged from 249 million to 354.1 million with the average being 298.1 million.

The index options volume of 361.3 million contracts Tuesday was 21% higher than the average in August. The total index options premium turnover was INR 687.11 billion Tuesday on the NSE, as against the average of INR 577.65 billion for Thursdays in August.

In June, both NSE and BSE had announced that they had received approval from the Securities and Exchange Board of India to change the expiry day of their equity derivatives. While the NSE had announced a shift in the expiry day to Tuesdays from Thursdays, the BSE had decided to move it to Thursdays from Tuesdays. In both cases, the change was to take effect from Monday. The market regulator had earlier fixed Tuesdays and Thursdays as the only expiry days for equity derivatives contracts.

The 21% surge in total index options volume on NSE Tuesday "reflects heightened hedging and speculative interest at the index level as market participants adjusted to the new expiry cycle," according to Dhupesh Dhameja, derivatives research analyst at SAMCO Securities. Tuesday expiry in equity derivatives contracts on NSE is historic transition for NSE "after 25 years of Thursday being synonymous with expiry," Nandish Shah, senior derivative and technical analyst at HDFC Securities, said.

"However, we cannot definitively attribute this entire volume surge to the change in expiry day alone (as) Tuesday's session was characterised by significant intraday volatility," he said. According to Shah, it will take a "few more expiries to have a clear idea" about the change in trading volumes due to shift in expiry day.

To intraday options traders the premium decay and news flow around the expiry days determines the intraday volatility and volumes. "It does not matter much whether the expiry day is on Tuesday or Thursday," Jaynesh Kasliwal, an individual intraday options trader told Informist.

This week, the BSE will have its first-ever expiry Thursday for its Sensex weekly options contracts. There are mixed expectations among analysts with regard to whether market share in index options volume of BSE will increase or decline as a result of the change.

The Sensex weekly options are likely to witness elevated trading volumes compared to previous expiries which took place on Tuesday s, according to Dhameja. There is event-driven positioning to Thursday's expiry that supports trading activity, he said.

"Reserve Bank of India's announcements, fiscal data releases, and global macro prints typically fall around this time," Dhameja said. The Thursday expiry day gives BSE an opportunity to capture mid-week flows, particularly from retail traders and proprietary desks, he said.

But other analysts foresee an erosion in BSE's recent gains in market share in index options volume. The earlier Tuesday expiry on BSE's equity derivatives segment gave it the benefit of volume build-up on Friday, Monday, and Tuesday. This will now get compressed to two days - Wednesday and Thursday.

Back-of-envelope calculations from latest SEBI bulletin data showed NSE accounted for 75.8% of total index options premium turnover in the April-July period while BSE had a share of 24.2%. End

Edited by Ashish Shirke

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