The Bombay Stock Exchange (BSE) on April 05, 2024, notified regarding the Pre-Trade Risk Control – Limit Price Protection in Equity Derivatives Segment.
The following Features of the LPP Mechanism have been stated:
• The Limit price orders within the Limit Protection Price (LPP) range (higher for buy orders & lower for sell orders) of 60% of the reference price for Option contracts (calculated as per details in point b below and subject to minimum LPP value of Rs.30) and 3% of reference price for Future Contracts (calculated as per details in point b below and subject to minimum LPP value of Re 1.50) shall be accepted by the trading system and orders beyond this price range would get rejected.
• The LPP range validation shall be subject to the order price being within the prevailing price bands applicable at the time of order placement for that contract.
• The LPP validation shall not be applicable for limit price orders placed in calendar spread futures and option strategy contracts.
This will come into effect from April 16, 2024.
Kindly find the Annexure provided with this document attached to the document.
[Notification No 20240405-40]
