123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Writing >> View Article

Currency Trading In India

By Author: Surbhi Choudhary
Total Articles: 21

Different economies are linked with each other in concern of FDI and FII that promote the ultimate growth of the economy. Forex is an international market that facilitates trading in different currency pairs. At domestic or national level, there various Exchanges are available that provide a platform for Currency trading tips like in India NSE (National Stock Exchange), MCX-SX.
In both this exchange mainly 4 currency pairs are traded on its Derivative contract.
This are

Currency Pairs LOT Size

USDINR 1000
EURINR 1000
GBPINR 1000
JPYINR 1000

As derivative is the contract whose value is derived from underlying assets in currency, future underlying asset is the RBI Reference rate in the spot market. In this above pairs an individual or institution can work on a future contract and buy or sell fix minimum quantity i.e. Lot Size.
In this above currency pairs 1st currency is the base currency and 2nd currency is counter currency, like USDINR that represent the value of INR in 1 US dollar.
NSE has launched its currency, future trading platform on 29 August 2008 and introduced currency option trading on 29 October 2010.


As in NSE currency trading occur on its future contract that has particular expiry date, i.e. Two working days prior to the last working day of the month. If it is holiday on that day, then preceding day would be expiry at 12:30 PM and the contract cycle that exchange follow is for 12 months.

To trade in currency derivative an individual doesn't need to pay the full amount. He just has to pay an initial margin amount that is 2-5% to buy or sell a single lot of any pairs. Like suppose the current market price of USDINR September contract is 66.59 and an individual want to purchase a single lot of that then


66.59*1000 =66590 its 2-5% = 2330.65 (Approx) would be the investment required to buy or sell a single lot of USDINR.

As derivative is the contract between buyer and seller of contract that facilitate the delivery of the underlying asset on future dates. The main purpose of currency derivative is also for Hedging Arbitraging and speculation like stock futures contract that facilitate to different investor, trader or investment institutions to avoid the risk of price uncertainty.

Dig. Currency Derivative Mechanism

In this above Example buyer making a contract by paying an initial margin of 2-5% to exchange that before or on expiry of the contract will buy or accept the delivery of 1000 USD from seller.
And the seller making a contract by paying an initial margin of 2-5% to exchange that before or on expiry of the contract will deliver the 1000 USD to Buyer of the contract.

In Indian Currency market, there are different investor are there with different profile like some of them are individual trader and some are investment institutions. Like for different oil and gas industries international currency is required to purchase or import crude oil. Thus, this Oil & gas corporations also invest in the currency market to reduce the risk of price uncertainty.

Signature – Surbhi Choudhary [E-MARKETING EXECUTIVE] | Ways2Capital Provides MCX tips, intraday stock tips, NCDEX tips, forex tips, commodity tips . We also provide full support during market hours. | TO GET MORE DETAILS- VISIT US ON http://www.ways2capital.com | CONTACT US ON 0731-6554125

Total Views: 130Word Count: 670See All articles From Author

Writing Articles

1. Appmason Studios Inc.– Offering Technological Solutions To Enterprise, Startups And Small Businesses
Author: appmason

2. Judge In Puri Asked To Submit Reports For Mismanagement Issues In Srimandir
Author: Amitabh Bhattacharya

3. A Quick Look At The Emerging Dissertation Writing Service For Students In Uk
Author: Michale Jones

4. Certified Translation Services
Author: Linguidoor

5. Uplifting Quotes For The Day
Author: Sonia gola

6. Get Prompt Delivery From Trustworthy Academic Writing Service Agency
Author: Rony Sneijder

7. Struggle Of Bu-ali-sinna
Author: Sami Ahmad

8. Problem Faced By Women Working In Applique Work
Author: Amitabh Bhatacharya

9. Content Is The King And Will Always Be, But Is Incomplete Without These Things
Author: Web Click India

10. Why You Should Stop Multitasking | People Think
Author: Kunal Paul

11. Availing The Cheap Coursework Writing Service From Best Academic Writers Around The World
Author: David Shaw

12. How To Plan And Work On Multiple Assignments Simultaneously
Author: Tiana Crush

13. 5 Things To Check When Outsourcing A Transcription Project
Author: Tom Clark

14. How To Plan Your Success In Essays
Author: Tiana Crush

15. How To Choose Best Assignment Writing Service In Uk
Author: Uniresearchers

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: