What this means is that Maulik Securities has entered into an agreement withEmkay to buy the Sensex at that price. The contract will expire on the lastThursday of June. During Friday's trading on the bourse, the Sensex closedat 4727.63.

For the futures contract, the final settlement will take place on the lasttrading day of June while the final settlement price will be calculated onthe basis of a set of 120 cash Sensex values, the index value in thederivatives market, taken in the last half an hour of trading. With 20highest and lowest values of the set eliminated, the final settlement pricewill be calculated as an average of remaining 80 values.

All futures contracts are settled in cash with the clearing corporationacting as the counterparty to the bidder/seller, thereby guaranteeingsettlement of contracts.

As expected the volumes on the first day were quite small. According to theBSE, there were 146 contracts for June, 12 contracts for July and twocontracts for the month of August, while the total trades in all thecontracts were 160.

Dealers said that there were only 15 brokers who took part in the trading.Most investors were high net worth individuals and dealers said that therewere no institutional trades on the first day.

Commenting on the greater demand for June contracts, dealers said this wasbecause people are more comfortable predicting Sensex levels in the nearterm. Long contracts (three months) saw low interest because of the newnessof the product and also due to hesitation among clients to venture intopredicting the Sensex level after three months.

The closing price for the June contract today was Rs 4,783. The closingprice for the July contract was Rs 4,830 against an opening price of Rs4,900 while the closing price for the August contract was Rs 4,835.

The total value of the contracts traded during the day was to the tune of Rs3.83 crore. Out of the total 160 contracts entered into during the day, 106were squared off while the remaining 54 were outstanding reflecting `openinterest'.

Fulltime Sebi board member JR Verma, launching the trading earlier in theday, said that Sensex futures were the first derivative contracts in India,but would not be the last in the segment. "We will see that a variety ofinstruments are launched in the segment in the near future," he said.BSE President Anand Rathi termed it as a historical occasion for the Indiancapital markets. He expected the level of contracts traded daily to touch1000 by the end of this month itself and 100,000 by the end of 2000. Hesaid: "We have institutional members also but they did not participate todayas they still have some formalities (mainly sorting out margin issues) tocomplete. I expect them to join the action next Monday."

Senior executive director of Sebi, in charge of derivatives trading, L KSinghvi said "it's a new beginning and will provide a new platform tobrokers." Commenting on the low volumes and the few brokers who participatedin the trading, Simghvi said that it was expected as many of them were jutgetting used to the new product. "It will take time, some of them may bestill fine tuning their systems," he added.

As the premier stock exchange, the BSE launched derivatives based on theSensex, which was globally considered to be the benchmark index for theIndian capital market, he added.

Also present on the occasion were LC Gupta, chairman of the committee whichset the framework for derivatives trading, LK Singhvi, senior executivedirector, Sebi, and Nagendra Parakh, divisional chief, derivatives segmentof Sebi.