What is SGX Nifty and how it works?

Question 1:- What is Sgx Nifty?
Answer:- SGX Nifty is a Nifty Future Contract that gets traded on Singapore Stock Exchange. And that's why it is called SGX Nifty.

Question 2:- Is it thinly trade, or it gets traded in good volume?
Answer:- If you check the open interest on SGX for the Nifty future and compare it with NSE volume, you will be surprised to see that volume is almost equal.

Question 3:- What is the contract size value for SGX nifty?
Answer:- I want to explain it with an example. Today when I am writing this post, Nifty closed at Approx 15400. So, if someone would have taken one lot of SGX nifty on the Singapore Stock Exchange, he would have taken a position on 15400*2 USD = 30,800 USD = 30,800*73 = Approx 22.5 lac INR

In India, we have a lot size of 75. And the value of 1 nifty future here in India is 15400*75=11.5 Lac INR approx.

So, you can say that SGX nifty future contract value exposure is almost double Nifty's future in India.

To simplify it further, if you bought one SGX future contract and if nifty goes one point up, you will profit from two US Dollars.

Question 4:- Can I (one Indian) trade-in the SGX Nifty contract?
Answer:- No, Indian residents are not allowed to make any derivative trade outside the country. People with NRI status can trade there in SGX Nifty.

Question 5:- Where can we check SGX Nifty latest price?
Answer:- The best place is the SGX website.
The website address is:- https://www.sgx.com/.

Follow the below steps:-

Step 1:- Go to https://www.sgx.com/

Step 2:- Go to Derivative segment, then go to market information. In market information, click on "Delayed Prices - Future". The screenshot is given below.

Step 3:- You will come to a new page, from here search "NIFTY" and select "IN - SGX Nifty 50 Index Futures" from the dropdown given as below screenshot.

Step 4:- Once selected the SGX nifty, you will get below screen. Here you find the latest price of SGX nifty different months contract.

One thing you will observe here, you have two values of SGX Nifty. One is T, and another one is T+1. In the above screenshot, you would find two values for the June contract. "T - Jun 2021 - 15,414.00" and "T+1 - Jun 2021 - 15,444.50"

T is today's trading of Nifty on usual SGX exchange day timing. And this is the close price in the day session. T+1 is an evening trading session at SGX. Contracts traded in this session get settled the next day.

Question 6:- What are the timings for both T and T+1 session on SGX.

Answer:- As stated above, SGX trading happens in two sessions.

T is the current day session, and the timing is 9.00 am - 6.10 pm Singapore time. India time is 06:30 am to 3:40 pm. (As Singapore time is 2 hrs 30 mins ahead of us)

T+1 is the evening session, and the timing for this session is 6.40 pm - 5.15 am Singapore time. India time is 04:10 pm to 02:45 am.

Question 7:- How can SGX nifty help you start your day of trading?
Answer:- Well, 08:30 in the morning when you are preparing for your trading day, if you check the value of SGX Nifty, you can predict with some confidence whether Indian markets are going to open gap-up, gap-down or flat. This prediction will certainly be inaccurate a few time, but at least it will give you some hint to position yourself before the market opens.

Note for Learners of "Advance Options Trading Course" - Ask me any question or doubt you have related with SGX nifty on my WhatsApp number given to you. I will also explain the practical aspect of Sgx Nifty in one live class.

Kundan Kishore

A Complete Course On Indian Stock Market