On select F&O equities, the NSE will impose an increased exposure margin

On select F&O equities, the NSE will impose an increased exposure margin

After the contracts for April 2024 expire, on April 26, 2024, this framework will come into force.

On April 16, the National Stock Exchange (NSE) announced that it will be levying higher exposure margin on a number of equities related to futures and options. After the contracts for April 2024 expire, on April 26, 2024, this framework will come into force.

The Stock Exchange Platform said in a circular that securities in which the top 10 customers account for more than 20 percent of the Market Wide Position Limit (MWPL) would be subject to an additional exposure margin of 15 percent in the equity derivatives sector.

For a certain underlying stock, the maximum number of open F&O contracts allowed is known as the Market Wide Position Limit (MWPL). The exchange establishes this cap. Thus, for a certain underlying stock, it is the maximum allowed OI. It is stated in terms of shares.

On the other hand, extra monitoring margin is applicable for some stocks. It noted that the greater of the extra exposure margin mentioned above or the additional surveillance margin will be charged.

This system will identify scrips using rolling data spanning three months, and it will assess them every month.