The Gujarat International Finance
Tec-City Nifty, also known as the GIFT Nifty, is a derivative contract within
India’s financial landscape. It was initially traded on the Singapore Stock
Exchange (SGX). It consists of companies listed on the National Stock Exchange (NSE) in the
GIFT City in Gujarat, an international financial services centre.
The shift of GIFT Nifty to the NSE International Exchange in
Gandhinagar, India, has marked a significant shift in the Indian financial
market. GIFT Nifty acts as a benchmark for tracking the performance of these
companies and further offering insights into the overall market trends within
the GIFT City framework.
Traders actively engage with GIFT Nifty to
find future directions of the Nifty 50 index. Operating during regular market
hours following the Nifty index’s trading timings enables assessment of
companies’ performance within GIFT City, facilitating informed investment
decisions.
Most of the index moves in tandem with the
Nifty index. However, the India VIX displays a negative correlation with the NIFTY index. When the India
VIX decreases, the NIFTY rises, and when the India VIX goes up, typically, the
NIFTY drops down.
Upon acquiring
NSE IX membership, any investor, whether foreign or Indian, registered or
unregistered, is allowed to actively trade in the GIFT Nifty Index products.
The SGX Nifty
has a significant impact on the Indian market, offering a valuable tool to
track and forecast movement in the Nifty index. The time of the two indices
leverages investors with the GIFT monitoring to stay informed about market
dynamics, thus gaining insights into the whole trading process.
Timings of GIFT Nifty:
The GIFT Nifty
timings are important as they have a major impact on market participants. The
alignment of GIFT Nifty timings with the global market helps investors make an
informed decision while trading. The GIFT Nifty has two trading sessions: the first
trading session is from 6:30 am to 3:40 pm, while the second trading session is
from 4:35 pm to 2:45 am the next morning.
The combined GIFT Nifty timings are more than the SGX Nifty,
which used to trade from 6:30 am to 10:30 pm. The new timings of GIFT Nifty
overlap with the trading hours of the US, European, and Asian markets. This timing allows the index to sync with the domestic
market and provide investors with real-time price movements and trading
opportunities..
The different
trading timings of both indices have some implications. Firstly, it allows
investors to exploit arbitrage opportunities between the two markets by
leveraging price discrepancies during overlapping trading hours.
How to Trade
in GIFT Nifty?
Trading in GIFT Nifty involves major risks and is not
suitable for all investors. It is always better to invest capital that is
affordable to lose. Further, below are some steps to trade in the GIFT Nifty to
make your trading successful:
Open a Trading
Account: Choose a broker registered with the NSE IX. Popular options
include Motilal Oswal, BlinkX, and Zerodha. These brokers offer dedicated GIFT
trading accounts.
Complete KYC
(Know Your Customer): To complete KYC, you must submit identity and address proofs
per the broker’s regulations.
Fund Your
Account: Deposit funds in the required currency, such as USD, and
EUR, among others, as per the broker’s guidelines.
Monitor and
Manage your position: Keep track of positions and manage them as needed until
expiry or settlement.
Understand the
Risks: Futures contracts involve inherent leverage, which can
pacify profits and losses. Ensure you have a proper understanding of the risks
involved before trading.
Eligibility for GIFT Nifty Trading
Retail
investors residing in India are banned from trading in the GIFT Nifty due to
foreign exchange regulations.
NRIs, foreign
portfolio investors (FPIs), and eligible foreign investors (EFIs) are eligible
to trade through a broker who is a member of the NSE IX.
Conclusion.
GIFT Nifty index encourages
foreign investors to invest in the Indian derivatives market. It will make
India globally competitive with the financial hubs of developed economies.
For More Details Visit :-
https://blinkx.in/indices/gift-nifty
https://blinkx.in/indices/india-vix
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