The National Stock Exchange removed two stocks from its F&O ban list for September 23, but added one stock to the list as the scrip crossed 95 percent of the market-wide position limit.
Punjab National Bank is the latest stock added by the exchange in its F&O ban list. It was the top stock in the long build-up list, rising nearly one percent to Rs 40.50.
If derivatives contracts in securities cross 95 percent of the market-wide position limit, they end up in 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,” it said.
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.