Description

BSE announces market-wide and client-level position limits for 52 securities traded under Securities Lending and Borrowing Scheme (SLBS) for February 2026.

Summary

BSE has announced market-wide position limits, client-level position limits, and position limits for clearing members and institutional investors for 52 securities traded under the Securities Lending and Borrowing Scheme (SLBS) for February 2026. The circular covers a mix of ETFs (Exchange Traded Funds) and equity stocks with varying position limit thresholds.

Key Points

  • Position limits specified for 52 securities under SLBS for February 2026
  • Three tiers of limits defined: Market Wide Position Limit, Client Level Position Limit (1% of market-wide), and CM/Institutional Investor Limit (10% of market-wide)
  • Majority of securities covered are ETFs including sector-specific and index-tracking funds
  • Equity stocks include companies from healthcare, finance, hospitality, manufacturing, and other sectors
  • Client level limits range from as low as 1,365 shares (AXISHCETF) to 570,765 shares (LIQUIDCASE)
  • Market-wide limits range from 136,505 shares to 57,076,517 shares

Regulatory Changes

This circular provides updated position limits for SLBS trading for February 2026. Position limits are risk management measures that restrict the maximum number of shares that can be borrowed or lent under the SLBS framework. The limits are structured in a tiered manner:

  • Client Level: 1% of market-wide position limit
  • Clearing Member/Institutional Investor Level: 10% of market-wide position limit
  • Market Wide: Maximum aggregate positions allowed across all participants

Compliance Requirements

  • All market participants engaging in SLBS transactions must adhere to the specified position limits
  • Clearing members must monitor and ensure clients do not exceed client-level position limits
  • Institutional investors are subject to the 10% threshold of market-wide limits
  • Positions exceeding these limits will not be permitted

Important Dates

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

Impact Assessment

Market Impact: Medium - The position limits affect liquidity and trading activity in SLBS for the specified securities. ETF participants and institutional investors engaged in securities lending/borrowing will need to monitor their positions against these thresholds.

Operational Impact: Market participants, clearing members, and institutional investors must ensure their risk management systems are updated with the new position limits. The significantly varying limits across securities (ranging from ~136K to ~57M shares market-wide) reflect differences in liquidity and trading volumes.

Risk Management: These limits serve as safeguards to prevent concentration of positions and manage counterparty risk in the securities lending and borrowing mechanism. The tiered structure ensures diversification across participant categories.

Impact Justification

Affects trading limits for 52 securities under SLBS including multiple ETFs and stocks. Important for risk management but applies to specific trading mechanism with defined position limits.