Under the futures and options (F&O) segment, seven stocks were banned from trade on Tuesday, December 26, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Ashok Leyland, Balrampur Chini Mills, Delta Corp, India Cements, Hindustan Copper, National Aluminium Co and Steel Authority of India Ltd (SAIL).

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 and India Cements were retained on the list as the open interest as a percentage of the MWPL of their F&O contracts stood at 91.5% and 85.3%, respectively, on December 22. 

The open interest for the derivative contracts of Ashok Leyland stood at 80.6% of its MWPL at Thursday’s closing time, while that of Hindustan Copper was 96.4%. SAIL and Delta Corp saw the open interest for their F&O contracts touch 80.8% and 94% of their respective MWPLs, respectively. 

All the above securities were retained on the list from Friday, December 22. National Aluminium was added to the list on Monday as the open interest of its F&O contracts reached 103.7%.

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 the F&O contracts of Manappuram Finance and RBL Bank declined below the 80% limit to 77% and 77.1%, respectively. Hence, they were exited from the list on Tuesday. 

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.