Why is SGX Nifty Popular among International Investors?


You may have heard multiple times that SGX Nifty opens at 20 points, and therefore, investors invested more in NSE market. Did you ever try to get an idea about SGX Nifty? Like what exactly it is and how it has a positive impact on NSE.  Now it is right time to get some answers.

I suggest you read this article and then come back to know about the main reasons which make SGX Nifty a favorite choice among investors.

SGX Nifty is an Indian Nifty traded in Singapore Stock exchange. This is important since it offers the initial direction of NSE –National Stock Exchange of India Ltd. As you know, NSE stock exchange is open for only 6 hours from 9:00 A.M IST to 3:30 P.M IST.

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SGX Nifty is Open for 16 Hours

 International investors who are interested in Indian stocks and want to invest in these stocks might not be able to trade during this time. If they’re going to purchase stock from NSE and they come after 3:30 P.M IST then it means that they won’t be able to invest. All thanks to SGX Nifty, they can make an investment into the Indian market even when Indian Stock exchange is closed. Because SGX Nifty is remained opened for 16 hours from 6:30 A.M IST to 11:30 P.M IST. Global investors can make their purchases during these hours easily.  

SGX Nifty Serve as Direction indicator for NSE

Before a trader buys or sells any stock, he wants to know how a market is doing, whether it is going up or moving down. SGX Nifty is a derivate of nifty 50. It opens early from NSE market, so traders check it first. When they see that SGX nifty is 15 points up, then it is good news. Traders consider it a green signal, as soon as NSE market opens up they start purchasing more stocks from it.

On the other hand, when SGX is 20 points low, it is a red signal for traders. They don’t risk to invest in the NSE market.  In this way, SGX nifty impact the NSE market.

SGX Nifty has a Little Impact on NSE

It is good to know that the NSE market is affected by SGX Nifty up and down points, but this is not the only factor which shapes the market. There are certainly other factors, such as domestic factors, political affairs, geographical news, global factors, etc. The combined effects of these factors have a substantial impact on the Indian Stock Exchange. Even international stock market exchange performance also has some impact on NSE.

So, even SGX Nifty is open 3 hours before the national stock exchange of India, an investor like to wait until the domestic market opens. They get clues of NSE positive and negative direction, but they make an actual investment when NSE official open up. It is good to wait and see the real market direction and then make the decision of buying/selling stocks accordingly.

Wrap up

SGX Nifty is popular among foreign investors because they can get an indication of NSE through it. They can buy or sell Nifty future even when NSE is closed. The margin of the SGX product is lower than NSE.  This kind of trading of Indian Nifty in Singapore Stock exchange market is the best option for those investors who are interested in making an investment in Indian industry, but they can’t do it in the official hour of NSE.


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