Summary of this article
BSE overtakes NSE in F&O market share in April for first time
BSE leads in notional turnover and volumes, but NSE still dominates premium options segment
Lower costs, weekly expiry rule, and STT changes drove BSE’s rise
The Bombay Stock Exchange (BSE) has, for the first time, recorded higher derivatives trading activity than the National Stock Exchange (NSE) in April, ending the latter’s long-standing dominance in the segment.
BSE’s total notional turnover surged from Rs 4,274.76 lakh crore in March to Rs 5,377.73 lakh crore in April, registering 25.80 per cent month-on-month (m-o-m) growth. On the other hand, NSE's total notional turnover came down 21.65 per cent from Rs 5,536.94 lakh crore in March to Rs 4,338.20 lakh crore in April.
As a result, BSE's share of notional turnover increased to 55 per cent, while NSE’s share contracted to 45 per cent.
BSE’s notional average daily turnover (ADT) in equity derivatives grew by nearly 20 per cent in April to Rs 268.88 lakh crore on a month-on-month basis, whereas NSE’s notional ADT declined by about 26 per cent to Rs 216.90 lakh crore.
BSE outperformed NSE in trading volumes as well, with total contracts traded increasing 26.30 per cent to 351.20 crore in the month, while NSE registered a 21.83 per cent decline to 288.92 crore contracts.
NSE Continues to Dominate Options Premium Segment
While the BSE has successfully captured the lion’s share of notional turnover, NSE continues to hold a commanding 66 per cent share of options premium turnover, leaving the BSE with the remaining 34 per cent. This indicates that although BSE is seeing higher trading volumes, NSE remains the preferred exchange for higher-value contracts, where actual money involvement and revenues are significantly higher.
NSE's options premium turnover in April stood close to Rs 12.90 lakh crore, while BSE's stood at Rs 6.63 lakh crore.
What Drove The Turnaround
The shift in derivatives trading activity was partly driven by BSE’s lower cost structure, which has made it more attractive for participants. On futures contracts, NSE charges 0.00183 per cent or Rs 1.83 per Rs 1 lakh, while BSE does not levy any fee. In the options segment, NSE charges 0.0355 per cent or about Rs 36 per Rs 1 lakh, compared with BSE’s 0.005 per cent or Rs 5 per Rs 1 lakh on stock options.
The Securities and Exchange Board of India's (Sebi) decision to allow only one weekly expiry per exchange has also helped BSE attract more trading interest in the F&O segment. The change has reduced the advantage earlier enjoyed by NSE and spread trading activity more evenly.
It is also worth noting that the Securities Transaction Tax (STT) structure was revised from April. STT on futures was increased to 0.05 per cent from 0.01 per cent, while tax on options premium and exercise was raised to 0.15 per cent, up from 0.10 per cent and 0.125 per cent respectively.
Frequently Asked Questions
1. What was BSE’s F&O market share in April?
BSE’s share rose to about 55 per cent of notional turnover in April, while NSE’s share fell to around 45 per cent.
2. Does NSE still lead in any segment?
Yes, NSE continues to dominate options premium turnover with a 66 per cent share.
3. Why did BSE gain market share in F&O?
Lower trading costs and improved product structure helped attract traders to BSE.
4. Does higher turnover mean higher earnings?
Not necessarily, as premium turnover is more relevant for actual revenue generation.
