Mumbai: The National Stock Exchange (NSE) is to start a 15-minute pre-open session for equity futures and options from December 8. This new step aims to improve price discovery, make price gaps clearer, and reduce market volatility. It will also help traders understand opening prices better before the market starts.
The pre-open window will run from 9:00 a.m. to 9:15 a.m. Traders can place, modify, or cancel orders until a random close between 9:07 a.m. and 9:08 a.m. Then, price discovery and trade matching will happen until 9:12 a.m. After that, a short buffer will lead to regular trading at 9:15 a.m.
This system brings the derivatives market closer to the equity cash market’s pre-open call auction. NSE will also hold mock trading December 6. This practice session will help brokers and investors test the process before the official launch.
Initially, the feature will apply to current-month futures on stocks and indices. Later, it will expand to next-month contracts during the final five trading days before expiry. However, options, spreads, and corporate-action ex-dates will not be part of this plan.
During the session, traders will see live indicative prices and order imbalance details. They can place limit and market orders, but stop-loss and Immediate or Cancel (IOC) orders will not be allowed. Unmatched limit orders will move to the normal session, while unmatched market orders will change to limit orders at the discovered price.
India’s equity derivatives market continues to grow rapidly. The turnover jumped from ₹177 trillion in FY10 to over ₹40,000 trillion in FY25. This reflects a strong compound annual growth rate (CAGR) of nearly 43.5 percent, showing how active and expanding the market has become.