NCDEX gets board approval for electronic mutual fund platform, awaits regulatory nod

The Commodity & Derivatives Exchange (NCDEX) on Wednesday (November 12) has received approval from its board to launch an electronic mutual fund distribution platform. The exchange is now awaiting regulatory clearance to commence operations of the platform.

The move positions NCDEX to compete directly with the BSE StAR MF platform and NSE’s NMF platform in the mutual fund distribution space. In August, the exchange received preliminary approval to trade equity-related products, including derivatives.

Back in July this year, Commodity and Derivatives Exchange Ltd had inked an agreement with the India Meteorological Department (IMD) that will lay critical groundwork for launching India's first weather derivatives.

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This Memorandum of Understanding (MoU), signed on June 26, lays the critical groundwork for the launch of India's first weather derivatives -- a long-anticipated market instrument designed to help farmers and allied sectors hedge against climate-related risks such as erratic rainfall, heatwaves, and unseasonal weather events, NCDEX said in a statement.

With this partnership, NCDEX will develop a rainfall-based derivative product, among others, using historical and real-time datasets sourced from IMD.

"While our endeavour is to launch it early so that stakeholders benefit. We will need time for developing a product considering southwest and eastern monsoon cycles and then test our hypothesis before we submit it for regulatory approval, and it is difficult to give any concrete timeframe at this juncture," NCDEX Managing Director and CEO Arun Raste said.

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