Under the futures and options (F&O) segment, six stocks were banned from trade on Wednesday, 30 October by the National Stock Exchange (NSE). The securities banned for the F&O trade are IDFC First Bank Ltd, Indiamart Intermesh Ltd, L&T Finance Ltd, Manappuram Finance Ltd, Punjab National Bank, and RBL Bank 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. 

IDFC First Bank, Indiamart Intermesh, and RBL Bank were retained on the list from Tuesday as the open interest as a percentage of the MWPL of its F&O contracts stood at 89.8%, 88.8%, and 87.5%, respectively. L&T Finance derivative contracts’ open interest is 85.1% of its MWPL on 30 October, compared to 87.2% for Punjab National Bank and 81.4% for Manappuram Finance. 

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 Dixon Technologies (India) and Escorts Kubota Ltd declined below the 80% limit. Hence, they were removed from the list on Wednesday.

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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