Description

BSE announces updated market-wide, client-level, and institutional position limits for 52 securities available for Securities Lending and Borrowing Scheme (SLBS) transactions effective February 2026.

Summary

BSE has announced the market-wide position limits for stocks traded under the Securities Lending and Borrowing Scheme (SLBS) for February 2026. The circular specifies position limits at three levels: market-wide position limits, client-level position limits (1% of market-wide limits), and position limits for clearing members and institutional investors (10% of market-wide limits). The limits apply to 52 securities including various ETFs and individual stocks.

Key Points

  • Position limits updated for 52 securities traded under SLBS
  • Three-tier limit structure: market-wide, client-level, and CM/institutional investor level
  • Client-level limits set at 1% of market-wide position limits
  • Clearing member and institutional investor limits set at 10% of market-wide limits
  • Includes diverse securities: ETFs (banking, sectoral, thematic) and individual stocks
  • Highest market-wide limits: LIQUIDCASE (57,076,517 shares), SBFC Finance (51,657,452 shares)
  • Lowest market-wide limits: HDFCGROWTH (138,782 shares), AXISHCETF (136,505 shares)

Regulatory Changes

This circular updates the position limits for SLBS transactions. The limits are calculated in number of shares and apply to:

  • Market-Wide Position Limit: Total open positions allowed across all market participants for each security
  • Client Level Position Limit: Maximum position a single client can hold (1% of market-wide limit)
  • CM and Institutional Investor Limit: Maximum position for clearing members and institutional investors (10% of market-wide limit)

The limits cover a broad range of securities including:

  • Banking and financial sector ETFs (BANKETF, BANKBETF, PSUBANKADD, PVTBANKADD)
  • Thematic and sectoral ETFs (MOMENTUM, NIFTYQLITY, HEALTHY, QUAL30IETF)
  • Broad market ETFs (SENSEXETF, NIFTYBETF, SMALLCAP, MIDSMALL)
  • Individual stocks across sectors (TATATECH, NUVAMA, DOMS, FEDBANK, etc.)

Compliance Requirements

  • All participants in SLBS must adhere to the specified position limits for February 2026
  • Clearing members must monitor and ensure client positions do not exceed 1% of market-wide limits
  • Institutional investors must maintain positions within 10% of market-wide limits
  • Market participants must track positions in real-time to ensure compliance with applicable limits
  • Risk management systems should be updated to reflect the new position limits

Important Dates

  • Effective Period: February 2026
  • Circular Issue Date: January 31, 2026

Impact Assessment

Market Impact: The position limits establish a framework for risk management in SLBS transactions, preventing concentration of positions that could impact market stability. The wide range of limits reflects varying liquidity and market depth across securities.

Operational Impact: Market participants engaged in securities lending and borrowing must update their risk management systems and position monitoring mechanisms to comply with the specified limits. The three-tier structure ensures proportionate risk allocation across different participant categories.

Trading Impact: Traders and investors using SLBS for short-selling strategies, hedging, or arbitrage must plan their positions within the prescribed limits. Securities with lower position limits may see more constrained SLBS activity, while those with higher limits allow greater flexibility for institutional strategies.

Impact Justification

Position limits directly affect trading strategies and risk management for participants in Securities Lending and Borrowing Scheme. Impacts 52 securities including major ETFs and individual stocks.