The BSE, Asia’s oldest inventory alternate, on Tuesday notified that it has modified its techniques to simply accept orders and execute trades at detrimental costs for the commodity derivatives section. The alternate’s buying and selling system has been upgraded within the wake of the current international developments within the crude oil derivatives markets the place buying and selling of derivatives contracts occurred at detrimental costs, the inventory alternate stated in a press launch.
“It’s hereby knowledgeable to all buying and selling members of commodity derivatives section that alternate’s BOLT Plus buying and selling system has been modified to simply accept orders and execute trades at detrimental costs,” BSE stated.
Because of this, current variations of buying and selling system Utility Program Interface (APIs) – ETI (Moral Buying and selling Initiative) in addition to IML APIs will even help buying and selling exercise at detrimental worth ranges, it added.
“BSE regularly modifications and upgrades varied pc techniques to enhance its functionalities, make them additional appropriate to further regulatory necessities, consumer/ market calls for, data safety, threat administration and so forth,” a BSE spokesperson stated.
“The present modifications are part of collection of modifications BSE has finished since introduction of commodities derivatives in October 2018 after receiving approval from regulator to launch Commodities derivatives. BSE newly launched contract on BRENT Crude oil is receiving good traction and is taken into account to be extra appropriate to Indian necessities by most specialists,” the spokesperson stated.
In a bid to facilitate testing of this function within the simulation (take a look at) surroundings, the buying and selling worth vary of Brent Crude Oil futures contracts shall be suitably up to date to simply accept orders at detrimental worth ranges and execute trades, the BSE stated within the press launch.
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“Buying and selling Members and front-end buying and selling software distributors shall be capable of place take a look at orders and commerce in these contracts at these worth ranges. This can assist members in checking the readiness of their inside techniques and make appropriate modifications if any required,” stated the press launch.
The alternate stated that the options shall be enabled within the simulation surroundings and made obtainable to members and distributors to check from Monday, Might 4, 2020, onwards.
The event got here in gentle of final week’s crude oil worth debacle attributable to which Multi Commodity Trade (MCX) settled April crude oil derivatives contracts at a detrimental worth, in an unprecedented transfer which was by no means seen in India’s commodity derivatives historical past.
Multi Commodity Trade Clearing Company (MCXCCL), an entirely owned subsidiary of the MCX India settled April expiry at a detrimental Rs 2,884 per barrel in wake of file droop within the West Texas intermediate (WTI), a US crude oil benchmark, crude oil worth.