April 1, 2021

F&O Update: Lot sizes for derivatives contracts revised

Blog | Updates

Here’s a heads-up for all traders who deal in futures and options. As you already know, SEBI periodically (every six months) revises the lot sizes for derivative contracts. The latest round of revisions is out, so we thought of giving you a quick update.

Why the revision?
For those just beginning to learn about derivatives (futures and options), here’s a primer. Unlike stocks which can be bought in units, derivatives contracts require you to buy the underlying asset (could be stocks, indices) in lots. Think of these lot sizes as the lot size of an IPO, but larger.

The SEBI fixes lot sizes of derivatives contracts such that the contract value is within ₹5 lakhs to ₹10 lakhs. The lot sizes are revised to maintain the contract value in this range in case of a change in the underlying stock/scrip’s current market price. To read the SEBI circular, click here.

The revision

With the basics out of the way, here’s a quick lowdown on how the lot sizes have changed and when the revisions will be effective.

Sr. No.	Underlying stocks whose derivative lot size shall be	Number of scrips changed	Effective date
1	Revised downwards	40	30 April 2021 (for May 2021 & later expiries)
2	Revised upwards	0	-
3	Unchanged	114	-
4	Revised downwards but new lot size is not a multiple of old lot size	2	30 April 2021 (for July 2021 & later expiries)

*For the fourth category of revisions, only the far month contracts (i.e. July 2021 expiry contracts and subsequent ones) will be revised for market lots. Contracts with a maturity of May 2021 and June 2021 will continue to have the existing market lots.

For all calculations, the average closing price of the underlying scrips has been taken from 1 to 31 March 2021. The updates come into effect from 30 April 2021. You can read the official circulars and annexures on the revisions here.

Further, to help you keep track of the changes, we've listed the revised lot sizes based on the latest update.

Sr. No.	Underlying	Present lot size	Revised lot size
1	Adani Enterprises	2,000	1,000
2	Adani Ports and SEZ	2,500	1,250
3	Apollo Hospitals	500	250
4	26 Apollo Tyres	5,000	2,500
5	Ashok Leyland	9,000	4,500
6	Bajaj Finance	250	125
7	Bharat Electronics	7,600	3,800
8	BHEL	21,000	10,500
9	Cholamandalam Investment and Finance Company	2,500	1,250
10	Cipla	1,300	650
11	Colgate Palmolive	700	350
12	Cummins India	1,200	600
13	Grasim Industries	950	475
14	Havells India	1,000	500
15	Hindalco	4,300	2,150
16	IDFC First Bank	19,000	9,500
17	Jindal Steel and Power	5,000	2,500
18	JSW Steel	2,700	1,350
19	Mahindra & Mahindra	1,400	700
20	Max Finance	1,300	650
21	Mindtree	800	400
22	Motherson Sumi	1,400	700
23	Info Edge	250	125
24	Piramal Enterprises	550	275
25	SAIL	19,000	9,500
26	SBI	3,000	1,500
27	Shree Cement	50	25
28	Siemens	550	275
29	Shriram Transport Finance	800	400
30	Tata Chemicals	2,000	1,000
31	Tata Motors	5,700	2,850
32	Tata Power	13,500	6,750
33	Tata Steel	1,700	850
34	Tech Mahindra	1,200	600
35	Titan Company	750	375
36	Torrent Power	3,000	1,500
37	Ultratech Cement	200	100
38	Vedanta	6,200	3,100
39	Voltas	1,000	500
40	Wipro	3,200	1,600

Here are the scrips that were revised downwards, but where the new lot size is not a multiple of old lot size.

Sr. No.	Underlying	Present lot size	Revised lot size
1	Bajaj Finserv	125	75
2	Coforge	375	200

Happy trading!

Disclaimer
The information provided is for educational purpose and should not be construed as investment advice by RKSV group. Investors should consult their advisor before making any investment decision. For more details, please visit www.upstox.com