Under the futures and options (F&O) segment, thirteen stocks were banned from trade on Friday, January 12, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Bandhan Bank, Bharat Heavy Electricals Ltd (BHEL), Delta Corp, Escorts Kubota, Hindustan Copper, India Cements, Indus Towers, National Aluminium Co, Piramal Enterprises, Polycab India, PVR Inox, Steel Authority of India Ltd (SAIL) and Zee Entertainment Enterprises Ltd (ZEEL).
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.
Indus Towers and Bandhan Bank were retained on the list as the open interest as a percentage of the MWPL of their F&O contracts stood at 89.2% and 91.3%, respectively, on January 11.
The open interest for National Aluminium’s derivative contracts stood at 83.4% of its MWPL at Thursday’s closing time, while that of India Cements was 86.2%. SAIL and Hindustan Copper saw the open interest for their F&O contracts touch 83% and 99.2% of their respective MWPLs, respectively.
At Thursday’s closing time, the open interest for PVR Inox and ZEEL’s derivatives contracts was 94.2% and 103% of their respective MWPLs, respectively. Escort Kubota’s derivative contract open interest was 85.3% of its MWPL, compared to 83.9% for Piramal Enterprises.
All the above securities were retained on the list from Thursday, January 11. BHEL, Delta Corp and Polycab India were added to the list on Friday as the open interest of their F&O contracts reached 98.7%, 99.2% and 165.2%, 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 the F&O contracts of Balrampur Chini Mills, Chambal Fertilizers and Indian Energy Exchange (IEX) declined below the 80% limit to 79.4%, 79.1% and 79.6%, respectively. Hence, they were exited from the list on Friday.
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.
