Lot size changes in F&O Stock Derivative contracts; 30th Sept, 2022

On 30th September 2022, SEBI has issued a circular intimating about the changes proposed to the lot size of various F&O contracts. Now lot sizes are the fixed units of stock in which future and options can be traded. Typically, SEBI tries to keep F&O lot sizes at around the value of Rs7 lakhs to Rs10 lakhs on a median basis. F&O lot sizes are normally changed in 4 ways. Lot sizes can be increased, or the lot size can decreased or it can be decreased (not as a multiple) of the original lot size. Alternatively, lot sizes can also be kept unchanged. Here is a summary of the major lot size changes and their effective dates.

Gist of the lot size changes in F&O; 30th September 2022

The table below captures the essence of lot size changes in F&O, with the number of companies and the likely effective date of such change.

List 1 – Lot sizes are revised down as multiple of old lots

Here is a list of companies where the contract lot size has been reduced as an exact multiple of the old lot sizes. Normally, the lot sizes are reduced where there has been a sharp appreciation in the stock price since the last review.

The lot size changes above are intended to restore the value of one lot back to the prescribed range by SEBI.

List 2 – Lot sizes revised upwards

Here is a list of companies where the contract lot size has been increased as multiple of the old lot sizes. Normally, the lot sizes are increased where there has been a sharp fall in the stock price since the last review.

The lot size changes above are intended to restore the value of one lot back to the prescribed range by SEBI.

List 3 – Lot sizes revised down, but not as multiple of old lot size

Here is a list of companies where the contract lot size has been reduced but not as multiple of the old lot sizes. Normally, the lot sizes are reduced where there has been a rise in the stock price since the last review.

The lot size changes above are intended to restore the value of one lot back to the prescribed range by SEBI.

List 4 – Lot sizes of contracts kept constant

There are a total of 157 companies where the lot sizes have been maintained constant due to the price change in the stock not being substantial, either ways. The complete list of stock where lot sizes are unchanged can be accessed at the hyperlink below.

https://archives.nseindia.com/content/circulars/FAOP53920.zip

Additional points to note

Here are some additional points to note regarding the lot size changes in List 2 and List 3 above.

 
    • Only the far month contract i.e. January 2023 expiry contracts and beyond will be revised for market lots. Contracts with maturity of November 2022 and December 2022 would continue to have the existing market lots. 

    • The day spread order book will not be available for the combination contract of December 2022 and January 2023 expiry for the stocks in List 2 and List 3.

    • The price considered for the above computation by the exchange is average of the closing price of the underlying for one month period of September 01st to September 30th 2022.