Bankex
BSE's banking sector index and the Friday-expiry weekly options contract — a cash-settled alternative to Bank Nifty for banking sector derivatives.
Definition
Bankex is the Bombay Stock Exchange's banking sector benchmark, formally the BSE Bankex Index, comprising a select basket of the most liquid and well-capitalised scheduled commercial banks listed on BSE. It is a free-float market-capitalisation weighted index designed to represent the performance of the Indian banking sector. Bankex is the underlying for BSE's cash-settled weekly and monthly futures and options contracts. Under SEBI's 2023 circular rationalising weekly expiries to a maximum of one per exchange, BSE retained Bankex (alongside Sensex) as one of its two active weekly contracts, with expiry on Fridays. The lot size for Bankex derivatives is 15 units.
Why it matters
Indian banking stocks collectively form one of the heaviest weighted segments across all major domestic indices, and the banking sector's performance is intimately tied to macroeconomic variables — the RBI's repo rate decisions, credit growth data, non-performing asset disclosures, and liquidity conditions. Bankex options give traders a focused vehicle to express a sector view or to hedge a portfolio of banking stocks without the broader financial services noise that comes with Fin Nifty. After SEBI's weekly expiry rationalisation in late 2023, Bankex and Sensex became the only two BSE weekly contracts, drawing options volume from the discontinued NSE Bank Nifty and Fin Nifty weeklies. The Friday expiry date is particularly valuable: it captures the market's reaction to any Thursday evening announcements (RBI committee minutes, US non-farm payrolls, global risk events) and allows traders to structure a trade that expires before the weekend, avoiding gap risk from Saturday-Sunday developments. Margin requirements on Bankex options positions follow SEBI's peak-margin rules — intraday snapshots are taken at four random intervals and the highest is used for daily margin obligation. STT on Bankex options applies at exercise and on in-the-money contracts expiring with intrinsic value.
How it works
Bankex is computed in real time during BSE trading hours (9:15 AM – 3:30 PM IST) from the live prices of its constituent banking stocks, weighted by free-float adjusted market capitalisation. The constituent list and weights are reviewed periodically by the BSE Index Committee. Options on Bankex are European-style and cash-settled, meaning no physical delivery of shares occurs — only the difference between the strike price and the settlement value is exchanged. The final settlement price is BSE's official closing value of Bankex on expiry Friday. The tick size is 0.05 index points, and the contract multiplier is 15 units per lot.
Example
Say Bankex is hypothetically at 58,000 on a Thursday and a major private-sector bank is reporting quarterly results after market hours. A trader buys a 58,500 CE and simultaneously buys a 57,500 PE — a long strangle — both expiring the next Friday, paying a combined hypothetical premium of ₹300 per unit (₹4,500 total for a 15-unit lot). If results are strongly positive and Bankex surges to a hypothetical 59,200 by Friday's close, the CE is worth ₹700 intrinsic value, delivering a net profit of ₹400 per unit (×15 = ₹6,000) before costs. If results disappoint and the index falls to 56,800, the PE covers the loss. All numbers are hypothetical and purely illustrative.
See Bankex OI and strikes in real time
TradePulse surfaces Bankex open interest, PCR, and Greeks live for the Friday-expiry weekly cycle.