Under the futures and options (F&O) segment, seven stocks were banned from trade on Friday, 20 June, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Aditya Birla Fashion, Biocon, Central Depository Services, Housing and Urban Development Corporation, Manappuram Finance, RBL Bank, and Titagarh Rail Systems. 

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.

Biocon, Central Depository Services, HUDCO, and Aditya Birla Fashion were retained on the list from Thursday as the open interest as a percentage of the MWPL of its F&O contracts stood at 98.9%, 80.3%, 82.2%, and 85.9%, respectively.

Manappuram Finance derivative contracts’ open interest was 80.5% of its MWPL on 20 June, compared to 86.9% for RBL Bank and 84.6% for Titagarh Rail Systems. 

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 F&O contracts of Birlasoft and Chambal Fertilizers declined below the 80% limit. Hence, it was removed 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.

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