Stocks Under F&O Ban on September 4, 2024

4 Sep 2024 , 09:23 AM

On September 4, the NSE placed a ban on trading in the futures and options (F&O) segment for three specific stocks.

The ban was implemented because these stocks exceeded 95% of the market-wide position limit (MWPL), a threshold set to prevent excessive speculation. The stocks affected by this ban are Aditya Birla Fashion & Retail, Balrampur Chini Mills, and Hindustan Copper.

Despite the F&O ban, these stocks remain tradable in the cash market, allowing investors to buy and sell them as usual. The NSE regularly updates its list of securities under the F&O ban, reflecting changes in market conditions.

The ban is triggered when derivative contracts in the affected stocks surpass 95% of the MWPL, which signals an over-concentration of positions. During the ban period, traders are restricted to reducing their positions by offsetting existing trades; no new positions can be initiated.

Any attempts to increase open positions in these stocks during the ban will result in penalties and disciplinary measures by the NSE. The ban remains in place until the overall position in these stocks falls below the 95% MWPL threshold, after which normal trading in the F&O segment may resume.