MCX Stock Exchange (MCX-SX), India's new stock exchange, was launched on October 7, 2008, under the regulatory framework of Securities & Exchange Board of India (SEBI). The exchange received approval from SEBI and Reserve Bank of India (RBI) to launch a nationwide electronic platform for trading in currency derivatives.

Currently MCX-SX offers currency futures contracts in US Dollar-Indian Rupee (USDINR), Euro-Indian Rupee (EURINR), Pound Sterling-Indian Rupee (GBPINR) and Japanese Yen-Indian Rupee (JPYINR). Clearing and Settlement is conducted through the MCX-SX Clearing Corporation Ltd (MCX-SX CCL).

Within a year of its launch, MCX-SX has achieved a stupendous growth in average daily turnover and open interest. The average daily turnover increased from Rs 355.66 crore during in the first month of its operations (Oct 7, 2008 till Nov 6, 2008) to Rs 14617.24 crore for the month of January 2010.

MCX-SX witnesses participation from over 480 cities and towns across India and has a strong member base of over 600. Among hosts of benefits this state-of-the-art transparent national trading platform offers to a wide range of financial market participants -- hedgers (i.e. exporters, importers, corporates and banks), investors and arbitrageurs -- price discovery and price risk management are of foremost importance.

True to its philosophy of "Systematic development of markets through Information, Innovation, Education and Research", MCX-SX endeavours to ensure continuous innovation and to introduce products that conform to the needs of diverse market participants. The stock exchange is committed to continuously expand its menu of offerings by introducing trading in new asset classes under the extant regulatory framework. To begin with, MCX-SX will introduce trades in Equity, Debt, Interest Rates, Index and Exchange Traded Funds, subject to regulatory clearances.

A wide range of financial market participants -- hedgers (i.e. exporters, importers, corporates and banks), investors and arbitrageurs are benefitted by price discovery and price risk management on the transparent trading platform of MCX-SX.

Hedgers: MCX-SX provides a high-liquidity platform for hedging against the effects of unfavourable fluctuations in foreign exchange rates. Banks, importers, exporters and corporates can hedge on MCX-SX.

Investors: All those interested in taking a view on appreciation (or depreciation) of exchange rates in the long and short term, can participate in the MCX-SX currency futures. For example, if one expects depreciation of Indian rupee against US dollar, then he can hold on long (buy) position in the USD/INR contract for returns. Contrarily, he can sell the contract if he sees appreciation of the Indian rupee. Similar, long or short positions can be taken in EURINR, GBPINR and JPYINR if investors see any fluctuation in the Indian currency against other currencies like Euro, Sterling Pound and Japanese Yen

Arbitrageurs: Arbitrageurs get the opportunity of trading in currency futures by simultaneous purchase and sale in two different markets, taking advantage of price differential between the markets.

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