In a circular, NSE said the new mechanism is aimed to further strengthen orderly trading. "Orders shall be matched and trades shall take place only if the trade price is within the reference price and execution range," the exchange said. Besides, the bourse would automatically cancel any incoming order if it is outside the reference price and execution range. There would be no change to the existing applicable operating ranges for valid order entry and all orders that are within the operating range shall be accepted as is being done currently, the circular said. "Trade execution range shall not be applicable to India VIX futures and long term Option contracts on NIFTY," it added.
The new framework would come into effect from May 5 and would initially be applicable "to mid and far month futures and options contracts only".
Source: moneycontrol, NSE India.