Under the futures and options (F&O) segment, seven stocks were banned from trade on Wednesday, December 27, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Balrampur Chini Mills, Delta Corp, Hindustan Copper, National Aluminium Co and RBL Bank. 

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 National Aluminium were retained on the list as the open interest as a percentage of the MWPL of their F&O contracts stood at 86.5% and 93.7%, respectively, on December 26. The open interest for Delta Corp’s derivative contracts stood at 85.6% of its MWPL at Tuesday’s closing time, while that of Hindustan Copper was 85.6%. 

All the above securities were retained on the list from Tuesday, December 26. RBL Bank was added to the list on Wednesday as the open interest of its F&O contracts reached 99.7%.

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 Ashok Leyland, India Cements, and Steel Authority of India Ltd (SAIL) declined below the 80% limit to 74.3%, 76.6% and 78.3%, respectively. Hence, they were exited 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.