Under the futures and options (F&O) segment, nine stocks were banned from trade on Tuesday, September 12, by the National Stock Exchange (NSE). The securities banned for the F&O trade are BHEL, Chambal Fertilizers, Delta Corp, Hindustan Copper, India Cements, Indiabulls Housing Finance, Manappuram Finance, Punjab National Bank (PNB) 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.
The open interest for the derivative contracts of Delta Corp stood at 90.3% of its MWPL at the closing time on Monday, while that of Chambal Fertilisers was 89.9%. Hindustan Copper saw the open interest for its F&O contracts touch 88.1%. On September 11, PNB saw its open interest reach 80.5% of its MWPL.
The combined open interest for the derivatives contracts of Indiabulls and India Cements stood at 102.4% and 92.7% of their MWPL on Monday. Manappuram and SAIL were retained on the list as the open interest as a percentage of the MWPL of their F&O contracts stood at 93% and 90.6%, respectively, on September 11.
All the above securities were retained on the list from Monday, September 11. BHEL was added to the list on Tuesday as the open interest of its F&O contracts touched .4%.
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 contracts of Balrampur Chini Mills declined below the 80% limit to 78%. It, hence, was 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.