Can you tell me about the lot size changes announced by SEBI for stock futures and options in its latest circular?
Answer
Answer
You would be aware that SEBI, from time to time, modifies the lot sizes of various F&O contracts. Currently, trading in futures and options is allowed in 4 indexes and 199 stocks. On 31 March 2022, SEBI issued a circular highlighting the changes in the lot sizes applicable to futures and options contracts. Here is a broad logic for the changes in the lot size to the list. A total of 133 companies will see no changes to their lot size.
Shift in Lot Sizes
Total number of companies
Effective date
Lot size revised downward
12
29th April (for May-22 and later expiries)
Lot size revised upward
52
29th April (for Jul-22 and later expiries)
Lot size revised down but not exact multiples
2
29th April (for Jul-22 and later expiries)
No change in lot size
133
Not applicable
Total Stocks in F&O
199 companies
Key points to know about the revision of lot sizes.
· The above circular about changes in lot sizes will be effective from 29th April 2022. The April expiry is on 28th April, so the changes will be effective from the first day of the May 2022 contract.
· In the case of 12 companies, the lot sizes will be revised downward but these revisions will be in exact fractions of the old lot size. In the case of these 12 stocks, the F&O lot size revisions will be effective from the May-22 contract itself.
· In cases where lot sizes are revised upwards, or where they are revised downward (not in exact fractions), only far month contracts i.e. Jul-22 contracts will see lot size modification. In these cases, May-22 and the Jun-22 contracts will have old lot sizes.
· For the purpose of the computation, the average of the closing price of the underlying has been considered for the one-month period i.e. 01st Mar 2022 to 31st Mar 2022.
For the comprehensive list of the stocks under each of these categories, you can check the detailed list in the NSE circulars section. You can download the NSE circular (Download Ref No: NSE/FAOP/51841) from the NSE website for more comprehensive details.