Under the futures and options (F&O) segment, twelve stocks were banned from trade on Friday, 20 September, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Aarti Industries Ltd, Biocon Ltd, Birlasoft Ltd, Chambal Fertilizers Ltd, Gujarat Narmada Valley Fertilizers and Chemicals Ltd, Granules India Ltd, LIC Housing Finance Ltd, National Aluminium Ltd,  Oracle Financial Services, Punjab National Bank, RBL Bank, and Steel Authority of India 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. 

Aarti Industries Ltd, Oracle Financial Services, and Biocon were retained on the list from Thursday as the open interest as a percentage of the MWPL of its F&O contracts stood at 88%, 110.2%, and 95%, respectively. Birlasoft, Gujarat Narmada Valley, and Granules India were also retained on the F&O ban list, and the open interest of its MWPL contracts stood at 80.5%, 92%, and 172.2%, respectively.

LIC Housing Finance derivative contracts’ open interest is 90.5% of its MWPL on 20 September, compared to 91.2% for Punjab National Bank and 81.1% for RBL Bank

The above securities were retained on the list from Thursday, 19 September. Chambal Fertilizers, National Aluminium, Steel Authority of India and were added to the list on Friday as the open interest of their F&O contracts reached 114.9%, 96.3%, and 95.3%, 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 for F&O contracts of Balrampur Chini Mills Ltd declined below the 80% limit to 77.7%. Hence, it was removed from the list on Friday.

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.

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