Nifty Financial Services Derivatives

Spread the love

We all know derivatives of NIFTY 50 and BANK NIFTY are actively trading and many of us are doing index futures and options frequently. NSE recently announced good news for index derivatives traders. from 11th January 2021, one more index is allowing us derivative trading. in this post, we will discuss the Nifty financial services derivatives and their features.

Nifty Financial Services-FINNIFTY

FINNIFTY is the first index derivatives with a weekly futures contract along with weekly options.

Lot Size40
ExpiryWeekly (Thursday)
DerivativesFuture and Options
NIFTY Lot size75
BANKNIFTY Lot size25

NSE has received approval from SEBI to launch derivatives on the Nifty Financial Services Index in the futures & options segment of the Exchange. Currently, NSE offers index derivatives on only two equity indices – The Nifty50 index and the Nifty Bank index,” The exchange will offer futures and options in 7 serial weekly, excluding the monthly expiry and 3 serial monthly contracts, NSE said.

“This is the first time that the Exchange will make available weekly futures for the stock index derivatives. The derivatives are cash-settled with expiry day being the last Thursday of the expiry month for the monthly contracts and Thursday of the expiring week for weekly expiry contracts,” NSE said. The option contracts are European styled Call Option (CE) and Put Option (PE) with strike scheme of 30-1-30 and strike interval of 100, said the exchange.

NSE underscored that recent investment data of Foreign Portfolio Investors (FPIs) indicates 48 percent of new investment flows were into the financial services sector. The sector accounted for 35 percent of the assets under the custody of FPIs. Many of the asset management companies have mutual fund schemes in the financial sector theme. The Nifty Financial Services index has a 94 percent correlation and a beta value of 1.2 with the Nifty50 index. It has a correlation of 98 percent with the Nifty Bank index.

Also read: What is a stock market index? Types of Indices?


The financial services sector assumes significance as the sector accounts for 33.5 percent of the Nifty500 index. The Nifty Financial Services index comprises 20 stocks and is designed to reflect the behavior and performance of the Indian financial market which includes banks, financial institutions, housing finance, insurance companies, and other financial services companies, As opposed to the Bank Nifty, which comprises 12 banking stocks, the financial services index comprises 20 stocks from the banking, NBFC, HFC, insurance, asset management, holding company, and other financial services spaces. Given the high weightage of banking stocks, the Nifty Financial Services has a correlation of 98 percent with the Nifty Bank index. The Nifty Financial Services has delivered annualized returns of 15 percent in the last five years, NSE said.

Sl noStocks
1AXIS Bank Ltd
2Bajaj Finance Ltd
3Bajaj Finserv Ltd
4Bajaj Holdings and Investment Ltd
5Cholamandalam Investment and Finance Company Ltd
6HDFC Asset Management Company Ltd
7HDFC Bank Ltd 
8HDFC Life Insurance Company Ltd
9Housing Development Finance Corporation Ltd
10ICICI Bank Ltd
11ICICI Lombard General Insurance Company Ltd
12ICICI Prudential Life Insurance Company Ltd
13Kotak Mahindra Bank Ltd
14Mahindra and Mahindra Financial Services Ltd
15Piramal Enterprises Ltd
16Power Finance Corporation Ltd
17REC Ltd
18State Bank Of India
19SBI Life Insurance Company Ltd
20Shriram Transport Finance Co. Ltd


The Nifty Financial Services comprises 20 stocks from banks, NBFC, and insurance sectors. Top weights are HDFC Bank, HDFC, ICICI Bank, and Kotak Mahindra Bank. Following is the major weightage of stocks in the NIFTY FINANCIAL SERVICES INDEX.

HDFC Bank Ltd27.13
Housing Development Finance Corporation17.51
ICICI Bank Ltd 14.14
Kotak Mahindra Bank Ltd 12.10
Axis Bank Ltd6.46
Bajaj Finance Ltd 5.64
State Bank of India4.06
Bajaj Finserve Ltd2.29
HDFC Life Insurance Company Ltd2.21
SBI Life Insurance Company Ltd1.43

Final Thoughts

One more INDEX is entered to Future and options trading after NIFTY and BANK NIFTY. this time it is NIFTY FINANCIAL SERVICES. It is the first index derivatives with a weekly future’s contract along with weekly options. Index future and option traders got another exciting trading option after nifty and bank nifty. in this post, we discussed FINNIFTY and its details. I hope this post will give you an idea about the new index derivatives.

Happy trading

Spread the love

Leave a Comment

Your email address will not be published. Required fields are marked *