The National Stock Exchange (NSE), India's largest financial market, on Tuesday night announced the exclusion of as many as 50 stocks from the Futures & Options (F&O) segment as 'those' were unable to fulfill the eligibility.
Releasing a circular on its website www.nseindia.com on April 21, the largest bourses of India in terms of daily turnover and number of trades for both equities and derivative trading, NSE said that ‘contracts for new expiry months in the eliminating securities will not be available for trading on expiry of existing contract months.’
‘However, the existing unexpired contracts for the month of April, May and June 2009 would continue to be available for trading till their respective expiry while new stocks would also be introduced in these existing contract months,’ it added.
The eligibility norms of NSE to stay in F&O include the market wide position limit in the stock that shouldn’t be less than Rs.60-crore, and stock’s median quarter-sigma order size over the last six months that shouldn’t be less than Rs. 2 lakh.
‘The stock shall be excluded if the above criteria is not fulfilled for consecutively three months,’ said NSE that indicates that more stocks may come under the scanner, if they don’t meet the required criteria.
After exclusion of 50 stocks - 3i Infotech, Alok Industries, Amtek Auto, Aptech, Arvind, Balaji Telefilms, Ballarpur Industries, Bata India, Birla Corporation, Bombay Dyeing & Manufacturing Company, Central Bank of India, Development Credit Bank, Edelweiss Capital, Escorts, Everonn Systems India, Gateway Distriparks, Gitanjali Gems, Gujarat Narmada Valley Fertilizer Company, Gujarat Alkalies and Chemicals, Havells India, HCL Infosystems, Hindustan Oil Exploration Company, IRB Infrastructure Developers, Jet Airways (India), JSL, Kesoram Industries, KSK Energy Ventures, The Karnataka Bank, Lakshmi Machine Works, Mahindra Lifespace Developers, Maharashtra Seamless, MindTree, Monnet Ispat, MRF, Nava Bharat Ventures, New Delhi Television, Network 18 Fincap, NIIT, Peninsula Land, Rajesh Exports, Reliance Industrial Infrastructure, S. Kumars Nationwide, SREI Infrastructure Finance, SRF, Strides Arcolab, Thermax, Torrent Power, TVS Motor Company, UTV Software Communications, and Wockhardt – there are now only 184 left.
On the other hand, for enlisting in F&O segment, the stock would have to meet the stricter norms, which are: the market wide position limit (MWPL) in the stock shall not be less than Rs.100-crore and the stock’s median quarter sigma order size over the last six months shall be not less than Rs.5-lakh.
After eliminating stocks from F&O segment, NSE can also include new stocks which meet the norms. Such stocks shall be chosen from among the top 500 in terms of average daily market capitalization and average daily traded value in the previous six months on a rolling basis.
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