What causes F&O contracts to go into a ban period?

F&O contracts for a stock enter the ban period when the open interest crosses 95% of the Market Wide Position Limits (MWPL). During the ban period:

• No new positions can be initiated in that stock’s F&O contracts.
• Existing open positions can still be traded or squared off.
• The ban is lifted only when open interest falls below 80% of the MWPL.
• The stock remains tradable in the cash segment without restrictions.
• Clients placing trades on banned securities receive automatic notifications.

Ban periods are part of SEBI and exchange risk management measures to ensure orderly trading.