What is FNO ban for a derivative ? Please explain, for example take IDBI , why is it always under FNO ban? But still we can see regular movement in its FNO, volumes, bids, O/i etc.
Well, For any security if its derivative contracts cross 95% of Market wide position limits (MWPL) then that security will be under ban for F&O. It means that the combined open interest of all option and future contracts for all the months taken together for that particular underlying crosses 95% of MWPL.
Once a stock is under ban, one can trade in that particular contract only to offset his/her existing position but not allowed to open or add a new contract, simply saying one cannot take a trade which increases open interest.
The stock comes out of ban only if its aggregated open interest comes down to 80% or below of MWPL. MWPL is expressed in number of shares, it is lower of
- 30 times average number of shares traded daily, during the previous calendar month, in the cash segment.
- 20% of number of shares held by non-promoters i.e 20% of the free float, in terms of number of shares of company . Exchange release MWPL data for each stock traded in derivative segment on a monthly basis. So, one is not restricted to trade in any manner under equity segment.
- In MIS intraday trading, nothing is banned from trading as stock should be squared off same day. Intraday Trading in banned Future scrips is totally allowed.
You can find FNO Ban scripts from the following link:
thank you and the point 3rd is the most important for me because I trade Intraday .
No…the pleasure is all mine…u r welcome…hope.u got ur answer…bro