Under the futures and options (F&O) segment, ten stocks were banned from trade on Thursday, 24 October by the National Stock Exchange (NSE). The securities banned for the F&O trade are Aarti Industries Ltd, Bandhan Bank, Birlasoft Ltd, Gujarat Narmada Valley Fertilizers and Chemicals, Indian Energy Exchange Ltd, Indiamart Intermesh Ltd, Manappuram Finance Ltd, NMDC Ltd, Piramal Enterprises Ltd, 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. 

Aarti Industries, Bandhan Bank, and Birlasoft were retained on the list from Wednesday as the open interest as a percentage of the MWPL of its F&O contracts stood at 88.2%, 86.9%, and 82.5%, respectively. Gujarat Narmada Valley derivative contracts’ open interest is 81% of its MWPL on 24 October, compared to 85.1% for Indian Energy Exchange and 129.4% for Indiamart Intermesh. 

Furthermore, Manappuram Finance, Piramal Enterprises, and RBL Bank were also retained on the list as their open interest is 94.3%, 90.3%, and 104%, respectively. 

The above securities were retained on the list from Wednesday, 23 October. NMDC was added to the list on Thursday as the open interest of their F&O contracts reached 97.3%.

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 Chambal Fertilizers, L&T Finance, and Punjab National Bank declined below the 80% limit. Hence, they were 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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