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Under the futures and options (F&O) segment, eight stocks were banned from trade on Thursday, 18 July by the National Stock Exchange (NSE). The securities banned for the F&O trade are Balrampur Chini Mills, Chambal Fertilizers Ltd, GMR AIrports, Gujarat Narmada Valley Fertilizers and Chemicals Ltd, Hindustan Copper, Piramal Enterprises, RBL Bank, and Vedanta 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.
The Chambal Fertilizers, GMR Airports, and Gujarat Narmada Valley were retained on the list from Tuesday as the open interest as a percentage of the MWPL of its F&O contracts stood at 83.4%, 93.2%, and 83.4%, respectively. Hindustan Copper derivative contracts’ open interest is 93.4% of its MWPL on 18 July, compared to 87.1% for RBL Bank.
The above securities were retained on the list from Monday, 15 July. Balrampur Chini Mills, Piramal Enterprises, and Vedanta Ltd were added to the list on Thursday as the open interest of their F&O contracts reached 98.4%, 102.2%, and 95%, 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 Aditya Birla Fashion Ltd, The India Cements and Indus Towers declined below the 80% limit to 79%, 77.3%, and 78.4%, respectively. Hence, it was removed 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.
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