The will revise the market lot size of its major index derivative contracts with effect from December 30, 2025, as part of its periodic review to keep contract values in line with the guidelines.
The lot size for Nifty 50 derivatives will be reduced from 75 to 50, while Bank Nifty will fall from 35 to 30. The Nifty Financial Services contract will be revised from 65 to 60, and Nifty Midcap Select from 140 to 120. The lot size for Nifty Next 50 will remain unchanged at 25, according to the circular.
“In pursuance of SEBI guidelines for periodic revision of lot size for derivatives contracts specified in the SEBI circular… dated December 2024, the market lot of derivative contracts on the following indices shall be revised,” the exchange said.
Weekly and monthly contracts created post December 30 will adopt the revised lot sizes, while existing quarterly and half-yearly contracts will continue with the old lot sizes until their expiration. The first contracts with the new size will expire in January 2026.
Periodic review
Lot‐size revisions are not new — exchanges periodically tweak contract sizes to keep notional exposure within manageable bounds for traders, especially as underlying indices climb. With valuations elevated in recent years, many of the standard derivative contracts carry very high notional value, potentially limiting participation by smaller traders.
This move comes at a time when derivatives trading volumes have been moderating. Index futures and options turnover, which had surged in late 2023, has seen a decline since November 2024 as a result of tighter margin norms, reduced weekly expiries, upfront premium collections and more recently, the Jane Street matter.
Index options’ notional turnover has seen a plunge by around 30 per cent since December 2024, with a 10 per cent drop in premium terms. The number of unique retail participants in the derivatives market has also declined by 20 per cent in FY25 compared to the prior year.
For smaller traders, the narrower lot sizes may lower capital thresholds and make index derivatives more accessible. For intermediaries and algorithmic players, the change will require systems reconfiguration and strategy recalibration. Market participants expect BSE to align its lot sizes with NSE’s to maintain competitiveness.