NCDEX AGRIDEX Futures Product Note

Chapter 1 - TRADING PARAMETERS ........................................................................................................ 2

Authority ........................................................................................................................................................ 2
Unit of Trading ............................................................................................................................................... 2
Months Traded In .......................................................................................................................................... 2
Tick Size ........................................................................................................................................................ 2
Unit for Price Quotation ................................................................................................................................. 2
Hours of Trading ........................................................................................................................................... 2
Last Day of Trading ....................................................................................................................................... 2
Mark to Market .............................................................................................................................................. 2
Position limits ................................................................................................................................................ 2
Margin Requirements .................................................................................................................................... 3
Special Margin .............................................................................................................................................. 3
Arbitration ...................................................................................................................................................... 3
Chapter 2 - CLEARING AND SETTLEMENT.............................................................................................. 4
Daily Settlement ............................................................................................................................................ 4
Daily Settlement Prices ................................................................................................................................. 4
Final Settlement Prices ................................................................................................................................. 4
NCDEX AGRIDEX Value .............................................................................................................................. 4
Expiry Date .................................................................................................................................................... 4
Pay in and Pay out for Daily Settlement / Final Settlement .......................................................................... 4
Completion of Settlement on NCCL Platform ............................................................................................... 4
Exhibit 1: Contract Specifications for Futures on NCDEX AGRIDEX .................................................... 5

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -1-
 NCDEX AGRIDEX Futures Product Note

Chapter 1 - TRADING PARAMETERS

Authority
Trading in NCDEX AGRIDEX Futures contracts may be conducted under such terms and conditions as
specified in the, Byelaws, Rules & Regulations and as per the circulars and notifications issued by the
Exchange thereunder or the Securities and Exchange Board of India (SEBI) from time to time. A specimen
of NCDEX AGRIDEX Futures contract specification is given in Exhibit 1.

Unit of Trading
The unit of trading shall be 1 lot, which is equivalent to 500 units.

Months Traded In
Contract launch calendar is attached as Exhibit 1. The same may be modified by the Exchange on
intimation to the members from time to time.

Tick Size
The tick size of the price of NCDEX AGRIDEX Futures contract shall be Rs. 0.25.

Unit for Price Quotation

The unit of price quotation for NCDEX AGRIDEX Futures contract shall be in Rupees per unit.

Hours of Trading
The hours of trading for NCDEX AGRIDEX Futures contract shall be as follows:
As notified by the Exchange from time to time, currently
Mondays through Fridays – 09.00 AM to 05.00* PM
(*: It will be changed to 09:00 A.M. to 09:00 P.M. whenever normal timings are restored)
On expiry day, the index futures shall expire at 05.00 PM.
The exchange may vary above timing with due notice.

Last Day of Trading

Last day of trading of NCDEX AGRIDEX Futures contract shall be the last trading day of the month.

Mark to Market
The outstanding positions in NCDEX AGRIDEX Futures contract would be marked to market daily based
on the Daily Settlement Price (DSP) as determined by the Clearing Corporation.

Position limits
The following limits will be applicable for positions grossed across all index futures contracts on the
Exchange.

Member-wise: Higher of 15% of the total open interest in the market in commodity index futures or 10,000
lots.

Client-wise: Higher of 5% of the total open interest in the market in commodity index futures or 1,000 lots.

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -2-
 NCDEX AGRIDEX Futures Product Note

Margin Requirements
NCCL will use Value at Risk (VaR) based margin calculated with at least a 99% confidence interval for a
margin period of Risk (MPOR) of three days’ time horizon. In case of portfolio based margining, this
requirement applies to each portfolio’s distribution of future exposure. NCCL reserves the right to change,
reduce or levy any additional margins including any markup margins. For further details, participants can
refer to circular no. NCDEX/TRADING-018/2019 dated June 21, 2019.

Special Margin
In case of unidirectional price movement/ increased volatility, an additional/ special margin at such other
percentage, as deemed fit by the Regulator/ Exchange/Clearing corporation, may be imposed on the buy
and the sell side or on either of the buy or sell sides in respect of all outstanding positions. Reduction/
removal of such additional/ special margins shall be at the discretion of the Regulator/ Exchange/NCCL.

Arbitration
Disputes between the members of the Exchange inter-se and between members and constituents, arising
out of or pertaining to trades done on NCDEX shall be settled through arbitration. The arbitration
proceedings and appointment of arbitrators shall be as governed by the Bye-laws and Regulations of the
Exchange.

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -3-
 NCDEX AGRIDEX Futures Product Note

Chapter 2 - CLEARING AND SETTLEMENT

Daily Settlement
All open positions of a futures contract would be settled daily based on the Daily Settlement Price (DSP).

Daily Settlement Prices

The Daily Settlement Price (DSP) will be disseminated by the Clearing Corporation at the end of every
trading day. The DSP will be reckoned for marking to market all open positions

Final Settlement Prices

The Final Settlement Price (FSP) will be determined by the Clearing Corporation upon maturity of the
contract. All open positions on the expiry day of the contract would be settled in Cash

The Final Settlement Price shall be the underlying index price arrived at based on Volume Weighted
Average Price (VWAP) of the constituents of the underlying index between 4:00 pm and 5:00 pm on the
expiry day of the Index futures contract. {In absence of trading in any constituent during the last one hour,
Clearing Corporation shall determine appropriate methodology (in line with the methodology for determining
daily closing price) to arrive at the appropriate price of the constituent to be used for determining index
price}.

NCDEX AGRIDEX Value

NCDEX AGRIDEX price is disseminated on a continuous basis on NCDEX website.

Expiry Date
Last day of trading of NCDEX AGRIDEX Futures contract shall be the last trading day of the month.

The settlement of contract would be by cash settlement.

Pay in and Pay out for Daily Settlement / Final Settlement

The table below illustrates timings for pay in and pay out in case of daily settlement as well as cash settled
positions for final settlement. The buyer clients would have to deposit requisite funds with their respective
Clearing Member before “pay in”.

All fund debits and credits for the Member would be done in the Member’s Clearing and Settlement Account
with the Clearing bank.

Time (T+1) Activity

On or before 08.30 hrs PAYIN – Debit paying member a/c for funds

After 10.30 hrs PAYOUT – Credit receiving member a/c for funds

Completion of Settlement on NCCL Platform

The settlement obligations on the NCCL platform shall be deemed to be completed as per the provisions
of the Bye-laws, Rules and Regulations of the Clearing Corporation and circulars issued by the Clearing
Corporation thereunder from time to time.

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -4-
 NCDEX AGRIDEX Futures Product Note

Exhibit 1: Contract Specifications for Futures on NCDEX AGRIDEX

Type of contract Index Futures

Name of Index NCDEX AGRIDEX

Underlying NCDEX AGRIDEX

Ticker symbol AGRIDEXDDMMMYYYY

For Example: for June expiry, ticker symbol will be:
AGRIDEX30JUN2020

Trading system NCDEX Trading System

Unit of trading 1 Lot (500 units)

Settlement Cash Settled

Maximum Order Size 50 lots

Quotation/base value Rs. per unit

Tick size Rs. 0.25

Trading hours As notified by the Exchange from time to time, currently:

Mondays through Fridays: 09.00 A.M. to 05.00* P.M.
(* : It will be changed to 09:00 A.M. to 09:00 P.M. whenever normal
timings are restored).
The Exchange may vary above timing with due notice.

Due date/Expiry date The last trading day of the month.

Opening of contracts Trading in any contract month will open on the 1st day of the launch
month. If the 1st day happens to be a non-trading day, contracts would
open on the next trading day.

No. of active contracts As per launch calendar

Price limit Daily price limit is (+/-) 4%. Once the 4% limit is reached, then after a
period of 15 minutes the limit shall be increased further by 2%. The
trading shall be permitted during the 15 minutes period within the 4%
limit. After the DPL is enhanced, trades shall be permitted throughout the
day within the enhanced total DPL of 6%.
The DPL on the launch (first) day of new contract shall be as per the
circular no. NCDEX/RISK-034/2016/209 dated September 08, 2016.

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -5-
 NCDEX AGRIDEX Futures Product Note

Position limits Trading member: Higher of:

15% of the total open interest in the market in commodity index futures
or 10,000 lots.
Client: Higher of:
5% of the total open interest in the market in commodity index futures or
1,000 lots.

Special margin In case of unidirectional price movement/ increased volatility, an

additional/ special margin at such other percentage, as deemed fit by the
Regulator/Exchange, may be imposed on the buy and the sell side or on
either of the buy or sell sides in respect of all outstanding positions.
Reduction/ removal of such additional/ special margins shall be at the
discretion of the Regulator/Exchange.

Final Settlement Price The Final Settlement Price shall be the underlying index price arrived at
based on Volume Weighted Average Price of the constituents of the
underlying index between 4:00 pm and 5:00 pm on the expiry day of the
Index futures contract.

Minimum Initial Margin 6%

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -6-
 NCDEX AGRIDEX Futures Product Note

Contract Launch Calendar

Contract Launch Month Index Futures Expiry Month

June 2020

July 2020
May 26, 2020
September 2020

December-2020

June-2020 No Launch
August-2020
July-2020
June-2021
August-2020 No launch
September-2020 October-2020

November-2020

October-2020 March-2021

September-2021
November-2020 No launch
December-2020 January-2021
February-2021
January-2021
December-2021
February-2021 No launch
March-2021 April-2021

The contents of this product note are subject to Rules, Byelaws and Regulations of NCDEX as in force
from time to time and be read therewith. -7-