Additional Exposure Margin on Securities under MWPL – January 2026

Description

BSE announces additional exposure margin requirements for 18 securities under the Market Wide Position Limit (MWPL) framework for January 2026.

Summary

BSE has imposed additional exposure margin requirements on 18 securities under the Market Wide Position Limit (MWPL) framework for January 2026. This surveillance measure targets securities that have exceeded position concentration thresholds, requiring higher margins from market participants. The list includes major stocks across banking, pharmaceuticals, energy, telecommunications and other sectors.

Key Points

• 18 securities subject to additional exposure margin under MWPL framework
• Includes major banking stocks: RBL Bank, Bandhan Bank, LIC Housing Finance, PNB Housing Finance
• Pharma sector: Aurobindo Pharma, Glenmark Pharmaceuticals
• Energy/Infrastructure: JSW Energy, NMDC, SAIL, Petronet LNG, Indus Towers
• Other sectors: Vodafone Idea, Crompton Greaves, Aditya Birla Capital, Manappuram Finance
• MWPL is a surveillance mechanism to monitor position concentration
• Additional margins aim to reduce excessive speculation and manage systemic risk

Regulatory Changes

The additional exposure margin applies to the listed 18 securities as part of BSE’s Market Wide Position Limit surveillance framework. This is a risk management measure to control excessive concentration in derivative positions and ensure market stability. The margin requirements are over and above standard margins for these securities.

Compliance Requirements

• Trading members must collect additional exposure margins from clients holding positions in the listed securities
• Clients must maintain sufficient margin coverage for positions in these 18 stocks
• Risk management systems must be updated to reflect enhanced margin requirements
• Failure to maintain margins may result in position squaring off or trading restrictions

Important Dates

• Effective Date: January 2026 (as per circular date: January 27, 2026)
• Applicable for positions in the specified securities during the month

Impact Assessment

Market Impact: High - The additional margin requirements will increase the cost of carrying positions in these 18 securities, potentially reducing speculative activity and trading volumes. Major liquid stocks like Vodafone Idea, JSW Energy, and SAIL being on the list may see reduced derivative market participation.

Trader Impact: Traders and investors holding leveraged positions in these securities will need to deploy additional capital or reduce position sizes. This may lead to short-term volatility as positions are adjusted.

Risk Management: The measure aims to reduce systemic risk by limiting excessive position concentration in specific securities, improving overall market stability.

Securities List

Impact Justification

High impact on trading costs and margin requirements for 18 securities including major banking, pharma, energy and telecom stocks. Additional exposure margins directly affect trader positions and capital requirements.