I downloaded the csv file from the following link for the MWPL of the Jan Month.
http://www.nseindia.com/products/content/derivatives/equities/position_limits.htm
But I don’t quite get what Market Wide Position Limit (MWPL) is and what are its consequences. Could someone explain this concept.
For any security if its derivative contracts crosses 95% of Market wide position limits (MWPL) then that security will be under ban for F&O.It means 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 can not 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 its the combined open interest for all the months. This is ‘all the months’ are only for the present contracts that we can buy right., Not past months which have been closed right ?
Yes,expired months are not considered.
Where can we see the MWPL data (positions) in live market, (I see zee biz provides, probable bans list around 3pm)
NSE won’t give live feed of that to clients anywhere, brokers get those from clearing corporations.
How can someone in Live market, come to know that the Stock MWPL in F&O has been crossed ? Because if I place a Futures order in live market, and then get stuck in that position due to the stock’s entry in F&O ban, I could have huge losses.
You can exit anytime, only entering into new position is not allowed but can exit anytime.