Under the futures and options (F&O) segment, nine stocks were banned from trade on Monday, September 11, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Balrampur Chini Mills, 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 92.4% of its MWPL at the closing time on Friday, while that of Balrampur Chini was 85.3%. Hindustan Copper saw the open interest for its F&O contracts touch 88.7%. On September 8, PNB saw its open interest reach 93.1% of its MWPL.
The combined open interest for the derivatives contracts of Indiabulls and India Cements stood at 104% and 94% of their MWPL on Friday. 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 95.3% and 92.8%, respectively, on September 8.
All the above securities were retained on the list from Friday, September 8. Chambal Fertilizers was added to the list on Monday as the open interest of its F&O contracts touched 96.4%.
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 BHEL declined below the 80% limit to 76%. It, hence, was exited from the list on Monday.
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.