Currency Trading In India
Currency Trading is relatively new term for those dealing in shares only. You might be surprised to know that international Currency Trading market is worth $1,934,500,000,000 (i.e. $1.93 quadrillion). In other words, this is 2.5X larger than the global GDP. Also $5.3 trillion dollars volumes are traded every day in the forex market. This market runs 24 hours globally. Now coming to currency trading in India. Both NSE and BSE offer Currency Trading Market in India. Currency derivatives are traded as per weekly, monthly and quarterly basis.
What is Currency Trading in India?
In India Currency Trading is done in the form of derivatives. Currency futures and Options are traded over exchanges in various currency pairs in India. Currency futures are available in near month, next month and far month contracts as well as quarterly contracts. Weekly and Monthly Options are also available to trade in National Stock exchange of India.
Which Exchanges allow Currency Futures Trading in India?
In India Currency Trading is offered as derivatives by following exchanges –
- National Stock Exchange (NSE)- Started Currency derivatives trading in August 29, 2008
- Bombay Stock Exchange (BSE)- Started Currency derivatives trading in November 28, 2013
- Metropolitan Stock Exchange (MCX-SX)- Started Currency derivatives trading in Oct 7, 2008
What is timing of Currency Market in India?
Trading in Currency derivatives can be done from 9:00 am to 5:00 pm (Monday to Friday on working days).
What is the Expiry date and time of Currency Futures?
Expiry of monthly derivatives in currency market happens Two working days before the last business day of the expiry month at 12:15 PM. If this day is holiday, expiry is done on previous day OR as circulated by exchanges.
Final settlement day is Last working day (excluding Saturdays) of the expiry month
How does settlement takes place in Currency Trading in India?
As you know stock derivatives are settled physically i.e. on delivery basis. But Currency derivatives in India as not physically settled. They are settled in cash Only. In other words, there is no actual delivery of currency on expiry and is settled in cash.
Can We buy currency at Spot price OR in Cash in India?
No, Currency can not be bought in cash at spot price. Only currency pairs are traded in all exchanges in India. For Example when You buy USDINR @ 75, it means that 1 USD is equivalent to Rs. 75 at current rate.
Which Currency Pairs can be traded in India?
In India four currency pairs and three cross currency pairs can be traded.
USDINR, GBPINR, EURINR & JPYINR
Cross- Currency Pairs : EUR-USD, GBP-USD & USD-JPY
How much amount is needed to start Currency trading in India?
You can Buy/Sell Currency derivatives in lots.
1 Lot of USDINR denotes 1000 USD
1 Lot of EURINR denotes 1000 EUR
1 Lot of GBPINR denotes 1000 GBP
1 Lot of JPYINR –
The JPY INR contracts are a bit tricky compared to the other currency contracts. The lot size is not the usual 1000 units, but 100000 and the underlying here is the exchange rate for 100 Japanese Yen in Indian Rupees.
Margin Required to Buy/Sell 1 lot of USDINR – Rs. 1700- 1800 (Normal i.e. Holding Or Intraday)
Margin Required to Buy/Sell 1 lot of EURINR – Rs. 2100- 2200 (Normal i.e. Holding Or Intraday)
Margin Required to Buy/Sell 1 lot of GBPINR – Rs. 2900- 3000 (Normal i.e. Holding Or Intraday)
Margin Required to Buy/Sell 1 lot of JPYINR – Rs. 1900- 2000 (Normal i.e. Holding Or Intraday)
How to Open a Currency Trading Account in India?
A Currency Trading Account can be Opened through any privileged broker in India. Most brokers allow currency trading in four base pairs i.e. USDINR, EURINR, GBPINR & JPYINR.
USDINR is most traded currency derivatives. Trades BUY / Sell Futures and Options in USDINR. Weekly as well as monthly expiry options are also available to trade. Our recommended brokers given below charge Only Rs. 20 per Order in Currency trading and as used mostly by Indian Traders.
- Open Currency Trading Account in ZERODHA
- Open Currency Trading Account in UpStox
- Open Currency Trading 3-in-1 Account (Safest) in ICICIdirect.