Indian investor can now add one more investment option in their portfolio – currency derivatives. Regulatory approval from RBI and SEBI was recently made available (Aug 2008) and this allows exchanges in India to launch currency derivatives for trading, similar to equity / commodities derivatives trading

With the launch of currency derivatives in India through stock exchanges, there has been a dynamic shift in currency trading and hedging. An Indian entity would be able to take positions on the external value of the rupee without having an underlying foreign currency exposure. It would enhance overall efficiency of the currency market via transparency in pricing, increased investor base and categories, enhancing opportunities to invest and eliminate counter-party risk.