NSE Current Affairs

NSE’s India Index Services & Products Ltd launches Nifty equity savings index

The National Stock Exchange’s (NSEs) arm India Index Services & Products Ltd (IISL) has launched Nifty equity savings index that will serve as benchmark for equity saving funds offered by various mutual funds. The index will capture performance of portfolio having exposure to equity, equity arbitrage and debt instruments in similar way to the investment philosophy of equity savings funds.

Nifty equity savings index

The index is total return index capturing price return and dividend or coupon income. Its components are 30% exposure to Nifty 50 total return index; 30% exposure to equity arbitrage (long position in Nifty 50 total return index and equivalent short position in Nifty 50 futures Index); 30% exposure to Nifty short duration debt index; and 5% exposure to Nifty 1D rate index. The base date for index is April 1, 2005 and base value is 1,000. It will be calculated on an end-of-day basis. It will help to fill gap that was there due to absence of relevant benchmark for performance comparison of popular equity savings funds category offered by mutual funds in India.

Index Services & Products Ltd (IISL)

It is subsidiary of National Stock Exchange of India (NSE). It provides variety of indices and index related services and products for Indian capital markets. It is based in Mumbai, Maharashtra. It was founded in March 1998 with objective of providing variety of indices and index related services and products for capital markets. It operates as a subsidiary of NSE Strategic Investment Corporation Limited. It maintains over 100 equity indices comprising broad-based benchmark indices, sectoral indices and customized indices.

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SEBI Clears Vikram Limaye for the post of NSE Chief

SEBI has granted conditional approval for the appointment of Vikram Limaye as the MD and CEO of the NSE.

In February 2017, Limaye who is MD and CEO of infrastructure financing company IDFC was selected for the post of NSE chief. However, SEBI had not cleared his appointment as he was also present in the Supreme Court appointed four-member panel managing the affairs of the Board of Control for Cricket in India (BCCI).

Now, the SEBI has cleared the appointment of Limaye subject to the condition that he relieves himself from his BCCI assignment, among other things. Limaye’s term with the BCCI ends in August this year.

The NSE has already assured SEBI that Limaye will not seek an extension on his BCCI assignment. Limaye is expected to take charge of NSE at a time the exchange is facing challenges in multiple fronts. NSE has been functioning headless for the past six months. In addition, the vice chairman and founding member of the NSE Ravi Narain resigned from the board as the SEBI investigation in the algorithmic trading platform issue picked up. SEBI has also issued show cause notices to 14 directors of the exchange for their failure to maintain market sanctity.

NSE plans for an initial public offering in the second half of this year.

Background

Vikram Limaye was selected as the Managing Director of the National Stock Exchange (NSE) after Chitra Ramakrishna had quit the exchange in December 2016 citing personal reasons.

Vikram Limaye is chartered accountant with an MBA from The Wharton School. Earlier, Mr Limaye was also named a member of a four-member panel by the Supreme Court to run the Board of Control for Cricket in India (BCCI), the apex cricket management body in the country.

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