SGX Nifty

SGX Nifty, traded on the Singapore Exchange, tracks India’s Nifty index. It allows global investors to trade early and is priced in SGD, while Nifty uses INR.
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SGX Nifty
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3 mins read
05-April-2025

SGX Nifty is a futures contract that tracks India’s Nifty index but trades in Singapore. It allows global investors to access Indian market trends before markets open in India. As investing grows in popularity, understanding indices like Nifty and SGX Nifty is important. While both track the same companies, they operate in different markets.

Knowing these differences can help investors make better decisions. In this article, we’ll explain SGX Nifty, its features, and how it compares to Indian Nifty.

What is SGX Nifty?

SGX Nifty, or Singapore Exchange Nifty, is a popular derivative of India’s CNX Nifty, traded on the Singapore Stock Exchange (SGX). It allows foreign investors, including FIIs, to invest in the performance of the Indian stock market without directly trading in India. While Indian stocks aren’t available on SGX, futures products like SGX Nifty Futures enable investment in Nifty Futures. As an offshore instrument, SGX Nifty offers global investors a way to access the Indian market through futures trading based on the NSE Nifty index.

Key takeaways

  • SGX Nifty is a futures contract based on India’s Nifty 50 index, traded on the Singapore Exchange (SGX).
  • It allows foreign investors to invest in the Indian stock market without registering in India.
  • This makes SGX Nifty a popular choice for those who want to trade Indian stocks from anywhere in the world.
  • SGX Nifty trading hours in Indian time are from 6:30 AM to 3:45 PM.
  • SGX follows Singapore Standard Time (SST) and does not change for daylight saving time.

What is the SGX Nifty opening time?

SGX Nifty, which tracks the NSE Index, is settled based on the closing price of the S&P CNX Nifty in India. It offers two types of contracts with different settlement periods and trading timings:

E – SGX QUEST (T) Settlement: Same-day settlement, trading from 9:00 AM to 6:15 PM Singapore time (6:30 AM to 3:45 PM IST), Monday to Friday.

E – SGX QUEST (T+1) Settlement*: Next-day settlement, trading from 7:15 PM to 1:00 AM Singapore time (4:45 PM to 10:30 PM IST), Monday to Friday.

These flexible timings enable global traders to access SGX Nifty even after Indian markets close, as Singapore is 2.5 hours ahead of India. With trading hours from 6:30 AM to 11:30 PM IST, SGX Nifty offers a longer window than Indian markets, providing increased liquidity and enhanced price discovery. Traded in Singapore Dollars (SGD), SGX Nifty also allows investors to hedge against foreign currency risk while investing in Indian equity futures.

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How does SGX Nifty work?

The Singapore Stock Exchange Nifty (SGX Nifty) is a derivative contract that tracks India's Nifty 50 index and trades on the Singapore Exchange. This market opens about two hours before the National Stock Exchange (NSE) in India. Due to their strong correlation, early movements in Singapore often indicate how the Indian stock market might open. This time gap allows Indian financial institutions to analyse trends and offer pre-market trading insights. Additionally, the close financial ties between India and Singapore help investor sentiment influence both markets.

How is SGX Nifty different from Indian Nifty?

Let us explore some key differences between SGX Nifty and Indian Nifty:

Aspect

SGX Nifty

Indian Nifty

Trading Exchange

Singapore Stock Exchange

National Stock Exchange (NSE)

Nature

Futures contract based on Nifty

Benchmark index of top 50 Indian companies

Trading Hours

6:30 AM to 11:30 PM IST

9:15 AM to 3:30 PM IST

Denomination

Singapore Dollars (SGD)

Indian Rupees (INR)

Influencing Factors

Global market sentiment

Indian economy, policies, earnings

Market Information

Provides a future direction

Real-time market movements


How does SGX Nifty impact the Indian market?

Explore how does SGX Nifty impact the Indian market:

1. Time difference and early indication:

  • The time difference between the opening of the Singapore market and the Indian market provides a valuable early indication of market sentiment. Singapore markets open about two and a half hours before the Indian market.
  • Investors and traders use the SGX Nifty as a leading indicator to gauge the potential direction of the Indian market when it opens. Fluctuations in the SGX Nifty can provide insights into how the Indian Nifty might behave later in the day.

2. Pre-market trading and reaction to global cues:

  • SGX Nifty allows for pre-market trading, providing an avenue for investors to react to global cues and news that may impact the Indian market.
  • As global events and economic factors affect financial markets worldwide, including India, the SGX Nifty can reflect how international developments may influence investor sentiment in the Indian market.

3. Risk management and hedging:

  • Investors, especially those skeptical about the Indian market, may use SGX Nifty as a tool for risk management and hedging strategies. They can take positions in the SGX Nifty to offset potential risks in the Indian market.
  • It provides a way for investors to participate in the Nifty movement without directly engaging in the Indian market, offering a level of flexibility and risk mitigation.

4. Global economic structure differences:

  • The reference content rightly points out that India and Singapore have different economic structures. Economic events and policies in both countries can impact their respective markets differently.
  • Investors need to consider the broader economic factors in both nations when interpreting SGX Nifty movements and making decisions based on them.

5. Interconnected behaviour of Nifty and SGX Nifty:

  • The behaviour of the Indian Nifty and SGX Nifty is interconnected. Movements in one market can influence the other, creating a symbiotic relationship between the two.

Traders and investors cannot overlook either market when analysing market behaviour and making investment decisions.

Impact and trading hours

The Singapore Exchange (SGX) operates for 21 hours daily, from 6:30 AM to 3:40 PM and 4:35 PM to 2:45 AM, facilitating significant overlap with trading hours in Europe, Asia, and the Americas. This extended market exposure can influence global economic cycles. The SGX platform provides valuable trading information and enables investors to effectively plan hedging strategies.

Trading procedures

Contracts on the SGX are available in two durations: monthly and quarterly. The final trading day occurs two business days after the delivery date, excluding non-trading days. The exchange's 21-hour operating window empowers investors to implement efficient trading and hedging strategies aligned with their investment objectives and risk tolerance.

Advantages of SGX Nifty

Global exposure: International investors who are interested in gaining exposure to the Indian stock market can do so through SGX Nifty without needing direct access to Indian exchanges. This offers a convenient way to diversify portfolios across different markets.

Risk management: SGX Nifty futures enable investors to hedge their exposure to Indian equities. By taking positions on the SGX Nifty, investors can offset potential losses from their holdings in the Indian markets, thereby reducing overall risk.

The benefits and risks of this derivative depend on individual investment goals, strategies, and risk tolerance. As with any financial instrument, thorough research and personal assessment are essential before trading or investing.

Conclusion

SGX Nifty allows international investors to trade Indian equities without directly accessing the Indian stock market. However, regulatory changes and market dynamics can affect its trading, so investors should stay updated on any important developments.

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Frequently asked questions

What is SGX Nifty?

SGX Nifty is a Nifty index derivative, traded on the Singapore stock exchange, that assists in predicting and monitoring the performance of the Indian Nifty index. Here, SGX full form stands for Singapore Exchange.

In which currency the trades are performed in SGX Nifty?

SGX Nifty is a futures contract linked to India’s Nifty 50 index, traded on the Singapore Exchange. While the Indian Nifty 50 operates in Indian Rupees (INR), SGX Nifty transactions are conducted in Singapore Dollars (SGD).

What is the trade time of SGX Nifty (GIFT Nifty)?

GIFT Nifty futures are available for trading in two sessions based on Indian Standard Time (IST). The first session runs from 6:30 AM to 3:40 PM, followed by the second session from 4:35 PM to 2:45 AM.

What is the difference between Nifty and SGX Nifty?

Both indices reflect the performance of the Nifty 50, but they are traded on different exchanges. Nifty 50 is the benchmark index of the National Stock Exchange (NSE) in India, whereas SGX Nifty is its futures counterpart, traded on the Singapore Exchange, enabling global investors to gain exposure to Indian market movements.

Can Indians trade in SGX Nifty?

Yes, Indians can trade SGX Nifty through brokers registered with the Singapore Exchange. However, currency fluctuations and regulations add complexity. It is advisable to understand the risks involved before trading.

Why does SGX Nifty affect the Indian market?

Since SGX Nifty or Singapore Nifty reflects the anticipated performance of the Nifty, its movement can influence investor sentiment in India. A rising SGX Nifty might indicate a positive opening for the Indian market, and vice versa. However, other global factors can also impact the Indian market.

How is SGX Nifty calculated?

The SGX Nifty, being a futures contract, has a derivative contract size calculated by multiplying the current price of the Nifty Index futures by a multiplier of US $2. This results in an approximate contract size of US $11,000, assuming a futures price of $5,500.

What is the new name of SGX Nifty?

GIFT Nifty is a derivative product that serves as a benchmark for the National Stock Exchange's (NSE) NIFTY 50 index. Formerly known as SGX Nifty, it was recently rebranded and transitioned to NSE IFSC, an international exchange located in GIFT City, Gandhinagar, Gujarat. The index commenced trading on September 25, 2000, under the name SGX Nifty, and subsequently resumed trading under its new identity on July 3, 2023.

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