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Under the futures and options (F&O) segment, ten stocks were banned from trade on Thursday, 18 April, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Balrampur Chini Mills, Bandhan Bank, Gujarat Narmada Valley Fertilisers and Chemicals Limited, Hindustan Copper, Vodafone Idea, 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 Tuesday as the open interest as a percentage of the MWPL of their F&O contracts stood at 86.6%, 87.9%, and 88.4%, respectively. Bandhan Bank derivative contracts’ open interest is 91.*% of its MWPL on 18 April, compared to 86.8% for National Aluminium and 91.6% for Zee Entertainment.
Furthermore, Metropolis Healthcare, Steel Authority of India, and Piramal Enterprises were also retained on the list as their open interest is 95.6%, 91.2%, and 91.9%, respectively.
The above securities were retained on the list from Tuesday, 16 April. Vodafone Idea was added to the list on Thursday as the open interest of their F&O contracts reached 115.7%.
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 for F&O contracts of Exide Industries and The India Cements Ltd declined below the 80% limit to 68.9% and 78.8%, respectively. Hence, it was exited from the list on Thursday.
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.
