On Monday, November 25, 2024, the National Stock Exchange (NSE) added seven stocks to its Futures and Options (F&O) ban list. These stocks are restricted from being traded in the F&O segment due to exceeding 95% of the Market-Wide Position Limit (MWPL), which is a threshold put in place to control speculation and reduce market volatility.
Stocks Added to the F&O Ban List
The following seven stocks have been added to the F&O ban list:
- Adani Enterprises
- National Aluminium Company (NALCO)
- Aarti Industries
- GNFC (Gujarat Narmada Valley Fertilizers & Chemicals)
- Granules India
- Hindustan Copper
- Indraprastha Gas
Although F&O trading in these stocks is restricted, investors can still trade them in the cash market.
A stock is placed on the F&O ban list when its open interest (OI) exceeds 95% of the MWPL. Open interest refers to the total number of open futures and options contracts for a stock. When this limit is breached, it signals excessive speculation and heightened market activity, which can pose risks for investors. The F&O ban helps mitigate these risks by stabilizing prices and curbing unnecessary fluctuations.
This regulatory measure is vital for maintaining market stability and protecting investors from excessive risk. Make sure to stay updated and check the latest ban list on the NSE website before making any investment decisions.
