Traders take fresh bets on Vedanta despite F&O ban

Mumbai: Why did some clients create fresh positions on the Vedanta counter despite NSE’s clearing corporation levying a minimum penalty of 50,000 per violation per day on clients for trading on a stock in F&O ban?Two brokers ET spoke with believe that the option buyers could have punted in the knowledge of the stock exiting the ban period, and therefore, experiencing huge volatility. The stock has been in ban since September 30, exiting the ban on October 8 and re-entering it on October 9.The clients created fresh positions on the 100 strike call and put options. Exchange data at 3:30 pm Monday showed that the 100 strike call witnessed a fresh addition of 128 lots (6,200 shares make one lot) while the 100 put saw an addition of 222 lots.Buyers of the call expect Vedanta to cross Rs 105.9 while buyers of the put expect a fall below Rs 92 in the short term. These rates (Rs 5.9 and Rs 8 per share) are where buyers purchased a maximum number of lots.The underlying stock plunged 21 per cent to Rs 96.65 after the deemed failure of Vedanta’s delisting by its promoter.A stock, unless specified otherwise, enters a ban when the open positions reach 95 per cent of market-wide position limits and exits the ban when the OI falls below 80 per cent of MWPL. Ban means that only existing positions can be squared off with no fresh positions being created. Violation of this rule attracts a stiff penalty.

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