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NSE picks PNB as second stock on F&O ban list for Friday

If derivative contracts in securities crossed 95 percent of the market-wide position limit, they end up on the ban list, the NSE said.

May 13, 2022 / 06:53 AM IST
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The National Stock Exchange has decided to add Punjab National Bank as the second stock under the F&O ban for May 13 after the said scrip crossed 95 percent of the market-wide position limit.

Indiabulls Housing Finance is already on the ban list shared by the NSE for futures and options segment. After a day of sharp fall, the stock rebounded smartly by 6.75 percent to close at Rs 118.65.

The Punjab National Bank stock corrected nearly 14 percent to close at Rs 28.60 after a disappointing performance by the bank in the March 2022 quarter. Profit for the quarter stood at Rs 202 crore, registering a 66 percent decline on-year on account of higher provisioning.

If derivative contracts in securities crossed 95 percent of the market-wide position limit, they end up on the ban list, the NSE said.

“All clients/members shall trade in the derivative contracts of the said security only to decrease their positions through offsetting positions. Any increase in open positions shall attract appropriate penal and disciplinary action,” the NSE said.

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During the ban, traders are not allowed to take fresh positions in stocks but can start reducing their positions. The F&O ban rule helps reduce speculation in stocks.

The market-wide position limit, which is set by stock exchanges, is the maximum number of outstanding open positions (buy and sell) in the F&O contracts of a security. If the open interest in a stock crosses 95 percent of the market-wide position limit, its F&O contracts enter the ban period.

Normal trading in a security resumes only after the aggregate open interest across exchanges comes down to 80 percent or below the market-wide position limit, the NSE said.



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Sunil Shankar Matkar
first published: May 13, 2022 06:53 am
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