Why are there restrictions on placing Bank Nifty and Nifty option orders for certain strike prices?

What strikes are allowed for Nifty and Banknifty options trading on TradeJini?

For intraday (MIS) trades, all strikes of Nifty and Banknifty options are fair game. However, when it comes to overnight (NRML) trades, certain strikes face restrictions. This is in line with SEBI regulations that set market-wide Open Interest (OI) limits, aiming to ensure stability and manage risk.

Why are some strikes restricted for overnight trades?

SEBI mandates an upper limit on the OI of each F&O contract at brokers, based on 500 crores or 15% (whichever is higher) of the total OI for that specific contract across the market. Given TradeJini’s significant user base in index options, some restrictions exist on buying Out of the Money (OTM) options for specific strikes. This is a precautionary measure to stay within the allowed OI limits.

What is allowed in options trading on TradeJini?

Option buying and selling in all strikes during intraday (MIS) trades.

Option selling or writing in all strikes with no restrictions.

Long positions are allowed in any range until their count is equal to the short futures or options position one holds.

How can I trade restricted strikes?

Trading restricted strikes is facilitated through a custodian system. TradeJini has partnered with Orbis Financial, a SEBI-registered custodian, to provide this service.

How do I know if a strike is restricted?

When placing an order for an option, the order window will display any restrictions in place. The nudge feature will guide you by showing the permitted strikes.