February 24, 2024

Housing Finance Development

It's Your Housing Finance Development

Stocks Under F&O Ban: BHEL, NMDC, Indiabulls Housing Finance and 8 Others

Under the futures and options (F&O) segment, eleven stocks were banned from trade on Monday, November 21, by the National Stock Exchange (NSE). The securities banned for the F&O trade are Bharat Heavy Electricals Limited (BHEL), Chambal Fertilisers Ltd, Delta Corp Limited, Hindustan Copper Ltd, Indiabulls Housing Finance, India Cements Limited, Manappuram Finance Ltd, Multi Commodity Exchange of India (MCX), National Mineral Development Corporation (NMDC), RBL Bank Ltd, and Zee Entertainment Enterprises Ltd (ZEEL). 

Derivative contracts for these stocks were banned as the open market interest for these securities exceeded 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. 

Hindustan Copper and India Cements were retained on the list as the open interest as a percentage of the MWPL of their F&O contracts stood at 99.2% and 92.9%, respectively, on November 20. Manappuram Finance saw the open interest for its F&O contracts touch 89.4% of its MWPL. 

The open interest for the derivative contracts of ZEEL stood at 89.9% of its MWPL at Monday’s closing time, while that of Chambal Fertilisers was 88.1%. Delta Corp and MCX saw the open interest for their F&O contracts touch 82.4% and 90%, respectively, on November 20. The combined open interest for the derivatives contracts of RBL Bank stood at 94.5% of its MWPL on Monday. 

All the above securities were retained on the list from Monday, November 20. BHEL, Indiabulls and NMDC were added to the list on Tuesday as the open interest of their F&O contracts reached 95.7%, 96.3% and 96.4%, 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 Steel Authority of India Ltd (SAIL) declined below the 80% limit to 79%. Hence, it 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.