Study on Future & Option Market In India

Study on Future & Option Market In India

Author Name : Ajay Mukund Devkar, Dr. Harshada Mulay

ABSTRACT This study examines the evolution, current state, and future prospects of the Future and Option (F&O) market in India. The research explores the market's growth since its inception in 2000, analyzing key factors influencing its development, including regulatory frameworks, technological advancements, and economic policies. Through a comprehensive literature review and empirical analysis, the study investigates market efficiency, liquidity, and the impact of F&O trading on the underlying cash market. The research methodology employs both qualitative and quantitative approaches, utilizing historical data from the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), as well as surveys and interviews with market participants. Key findings reveal significant growth in F&O trading volumes, improved market depth, and enhanced price discovery mechanisms. However, challenges such as regulatory concerns, retail investor participation, and systemic risks are also identified. The study concludes by proposing policy recommendations to foster sustainable growth in the Indian F&O market and highlighting areas for future research. This comprehensive analysis contributes to the understanding of derivative markets in emerging economies and provides valuable insights for policymakers, investors, and academic researchers.