Source: twitter
90% of bank nifty - we have it in fin nifty and 76% of fin nifty is basically bank nifty. We are having 2 weekly expiries basically.
Better to merge it into one and allow IT index to trade.
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They used to have Nifty IT in F&O earlier, but it didn’t pick up then. So, they decided to bring in another version of Bank Nifty because it was so popular with traders.
I don’t think they will stop Finnifty but maybe, they could consider adding Nifty IT on the day of Midcap expiry (assuming they have an informal understanding with BSE to not introduce any options expiry on Friday).
been highlighting this right from the start.
i stopped complaining & started embracing this redundancy. similar strategies will work on both finnifty & banknifty in the ratio of the correlation.
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Here’s another snapshot
Again I don’t know what exchanges think but here’s Some data.
Note: I calculated them myself 
So you can verify it later
Correlations:
Bw Nifty And Finnity- 0.94
Bw Nifty and bank Nifty- 0.88
Bw Banknifty and Finnifty- 0.98
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Here’s how the same graph would look if you also throw Nifty IT into perspective
The correlation of Nifty IT with all of the others lies between the 0.4-0.6 range.
Well, a suggestion would be to merge Finnifty and Banknifty and introduce NiftyIT derivatives however a problem would be Since Midcap nifty is yet to pic decent volumes having another new index would make traders reluctant due to low liquidity and adding to this would be BSE FnO since it’s also fairly new and had quite a few glitches making traders lose quite a bit.
However, at the same time, the current Odte setup of FnO would help IT pick up quick volumes at least on the expiry days.
Maybe @nithin could use his superpower again and let these words and suggestions reach the exchanges.
Bank Nifty is just banks. FinNifty is banks + other financial sector companies. Currently the free float market capitalisation for banks is way higher than these. Hence the observed high correlation. As these companies grow and command more market capitalisation FinNifty will get less correlated with Bank Nifty.
@t7support Bro when someone says “Finance” I would normally think he’s talking about NBFCs, BFCs and Insurance.
So Finance as a sector already includes banks what’s the point of picking just a part of finance out?
Though I might attract a lot of hate when I say this, by logic, I am not saying Finnifty to be merged with Banknifty but vice versa for Bank Nifty to get merged with Finnifty thus having a broad “Financial Services” Index.
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Correct.
This is a question for the exchanges. Typically all these products, separate expiry days etc is to facilitate more and more trading so that all players involved in the ecosystem can make money.
I see the brighter side. More opportunities to trade and profit from. Why bother about things that are beyond our control ?
Yeah definitely bro after all similar strategies can be played on both the ends finnifty and Banknifty to print more of cash
Once mid cap gets enough liquidity, nse should try IT index derivatives on the same day and see which one really sustains. Or if there is place for both then why not. 