The National Stock Exchange (NSE) has banned the trading of futures and options (F&O) on up to eight stocks/securities on Tuesday, September 21, 2021. According to the NSE, these stocks are prohibited in the F&O sector because they have exceeded 95 percent of the market-wide position limit (MWPL).
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Under the F&O ban list, Indian Railway Catering and Tourism Corporation (IRCTC), Sun TV, National Aluminium Company (Nalco), Steel Authority of India Ltd (SAIL), Exide Industries, Punjab National Bank (PNB), Indiabulls Housing Finance Ltd. continue to be among the stocks that were under the ban period in the previous session whereas Vodafone Idea has been added to the list by the NSE today.
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The derivative contracts in the aforementioned securities have exceeded 95 percent of the market-wide position limit and have thus been placed in a ban period by the stock exchange.
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“It is hereby informed that all clients/members shall trade in the derivative contracts of said security only to decrease their positions through offsetting positions,” the stock exchange said. “Any increase in open positions shall attract appropriate penal and disciplinary action,” NSE added.
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During the F&O ban period, no new positions are permitted for any of the F&O contracts in that stock. The stock exchanges set the MWPL (market-wide position limit), which is the maximum number of contracts that can be open at any moment (Open Interest); thus, the F&O contracts of that stock enter a ban period if the open interest exceeds 95 percent of the MWPL.