What are the position limits in equity derivatives market?
A. The position limits specified are as under- Client / Customer level position limits: For index based products there is a disclosure requirement for clients whose position exceeds 15% of the open interest of the market in index products. For stock specific products the gross open position across all derivative contracts on a particular underlying of a customer/client should not exceed the higher of i. 1% of the free float market capitalisation (in terms of number of shares) Or, ii. 5% of the open interest in the derivative contracts on a particular underlying stock (in terms of number of contracts). This position limits are applicable on the combine position in all derivative contracts on an underlying stock at an exchange. The exchanges are required to achieve client level position monitoring in stages. Trading Member Level Position Limits: For Index options the Trading Member position limits are Rs. 250 cr or 15% of the total open interest in Index Options whichever is higher and f
