Securities and Exchange Broad of India
N. PARAKH
CHIEF GENERAL MANAGER
DNPD/Cir-30/2006
January 20, 2006
To
The Managing Director of NSE, BSE and their Clearing House / Corporation
All Registered FII and Custodians All Mutual Funds registered with SEBI
Association of Mutual Funds in India.
Dear Sir,
Sub: Modification of the Trading Member / FII / Mutual Fund position limits for stock based exchange traded derivative contracts
This circular is in partial modification of SEBI circular no. SMDRP/DC/Cir-13/02 dated December 18, 2002, prescribing the stock based derivative position limits for Trading Members, SEBI circular SEBI/DNPD/Cir-17/2003/10/29 dated October 29, 2003 prescribing the stock based derivative position limits for FIIs and SEBI circular DNPD/cir-29/2005 dated September 14, 2005 prescribing the stock based derivative position limits for Mutual Funds.
It has been decided to revise the Trading Member / Foreign Institutional Investor (FII) / Mutual Funds (MF) position limits for stock based derivatives:
I. For stocks having applicable market-wise position limit (MWPL) of Rs. 500 crores or more, the combined futures and options position limit shall be 20% of applicable MWPL or Rs. 300 crores, whichever is lower and within which stock futures position cannot exceed 10% of applicable MWPL or Rs. 150 crores, whichever is lower.
II. For stocks having applicable market-wise position limit (MWPL) less than Rs. 500 crores, the combined futures and options position limit would be 20% of applicable MWPL and futures position cannot exceed 20% of applicable MWPL or Rs. 50 crore which ever is lower.
III. The MWPL and client level position limits however would remain the same as prescribed.
The position limits shall be monitored in the manner prescribed in the SEBI circulars SMDRP/DC/Cir-13/02 dated December 18, 2002, SEBI/DNPD/Cir-17/2003/10/29 dated October 29, 2003 and DNPD/cir-29/2005 dated September 14, 2005.
This circular is being issued in exercise of powers conferred by section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with section 10 of the Securities Contract (Regulation) Act, 1956, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.
This circular is being issued in exercise of powers conferred by section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with section 10 of the Securities Contract (Regulation) Act, 1956, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.
This circular shall be implemented w. e. f. January 27, 2006.
Yours sincerely,
(N. PARAKH)
