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Under the futures and options (F&O) segment, eleven stocks were banned from trade on Tuesday, 16 April, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Balrampur Chini Mills, Bandhan Bank, Exide Industries, Gujarat Narmada Valley Fertilisers and Chemicals Limited, Hindustan Copper, The India Cements Ltd, Metropolis Healthcare, National Aluminium Company, Piramal Enterprise, Steel Authority of India, and Zee Entertainment Enterprise Ltd.
Derivative contracts of these stocks were banned as the open market interest for these securities has crossed 95% of the market-wide position limit (MWPL) set by the exchanges. The MWPL is the maximum number of contracts that can be opened at any particular time.
Balrampur Chini Mills, Hindustan Copper, and Gujarat Narmada Valley were retained on the list from Monday as the open interest as a percentage of the MWPL of their F&O contracts stood at 88.6%, 90.4%, and 91%, respectively. The India Cements Ltd derivative contracts’ open interest is 81.6% of its MWPL on 16 April, compared to 89.2% for National Aluminium, and 92.4% for Zee Entertainment.
Furthermore, Metropolis Healthcare and Piramal Enterprise were also retained on the list as their open interest is 102.8% and 94.7%, respectively.
The above securities were retained on the list from Friday, 12 April. Bandhan Bank, Steel Authority of India, and Exide Industries were added to the list on Tuesday as the open interest of their F&O contracts reached 96.6%, 95.9%, and 100.1%, respectively.
The ban will be lifted once the position falls below 80%. Traders will get penalised for buying or selling these securities. They will be available for trading in the cash market.
The open interest in F&O contracts for Vodafone Idea declined below the 80% limit. Hence, it was exited from the list on Tuesday.
The National Stock Exchange updates the list of securities on the F&O ban list daily. This list serves as a guide for traders and investors in the market. Traders who trade in indices do not encounter a situation of security ban.
