The stock market saw some movement today, but the main news was the ban on trading in futures and options (F&O) for eight stocks. This means that investors cannot buy or sell these stocks using F&O contracts.
The National Stock Exchange (NSE) puts out a list of stocks every day that cross a certain limit called the market-wide position limit (MWPL). When a stock’s trading activity goes above this limit, it is added to the ban list.
Which stocks are banned?
The eight stocks banned for trading in F&O today are:
- Birlasoft
- Gujarat Narmada Valley Fertilizers and Chemicals
- India Cements
- Indiamart Intermesh
- RBL Bank
- Granules India
The NSE puts these stocks on the ban list to control sudden and big price changes. When too many people buy or sell a stock quickly, its price can go up or down very fast. This can be risky for other investors. By banning F&O trading, the exchange tries to keep the market stable.
Investors can still buy and sell these eight stocks in the normal way, which is called the cash market. But they cannot use F&O contracts for these stocks. F&O contracts are a way to bet on the future price of a stock. By banning F&O, it limits the risk of big price swings.
Important to know
- The ban on F&O trading is for one day only. The list is updated every day.
- Investors should be careful when trading in stocks that are close to the MWPL limit.
- Before investing in any stock, it’s important to conduct your own research.
Overall
The ban on eight stocks from F&O trading is a measure taken by the stock market to protect investors. While it might be disappointing for some traders, it’s important to remember that market stability is crucial for everyone.