Image Courtesy:Knowledge.wharton.upenn.edu/ The National Stock Exchange has put a total of nine stocks/securities on hold for trading on Tuesday, November 16, 2021, in the futures and options sector (NSE). As per the NSE, these stocks have been placed on hold in the F&O segment because they have exceeded 95 percent of the market-wide position limit (MWPL).
Punjab National Bank (PNB), Escorts, Sun TV, Bank of Baroda, Bharat Heavy Electricals Limited (BHEL), Steel Authority of India (SAIL), Indiabulls Housing Finance, and National Aluminium Company are the eight stocks that remain on the F&O ban list today (Nalco). On the other hand, on Tuesday, the Indian Railway Catering and Tourism Corporation (IRCTC) was added to the list.
The stock exchange has placed the derivative contracts in the stated securities in a ban period since they have crossed 95 percent of the market-wide position limit, according to NSE. “It is consequently informed that all clients/members shall trade in derivative contracts of these assets exclusively to lower their positions by offsetting positions,” the stock exchange stated. “Any rise in open jobs will result in appropriate disciplinary and punitive action,” the NSE added.
When any stock or equity is under the F&O ban, no new positions are allowed in any of the F&O contracts in that stock. The MWPL (market-wide position limit) is the maximum number of contracts that can be open at any particular time, as established by stock exchanges (Open Interest). As a matter of consequence, if the open interest of that stock exceeds 95 percent of the MWPL, the F&O contracts of that stock enter a ban period.
