FIIs cut short bets in Nifty, Bank Nifty futures by this many contracts...

The NSE F&O data shows that FIIs open interest in index futures has declined by nearly 13 per cent from its peak; amid net purchases of contracts worth ₹7,737.41 crore in the last 8 trading sessions.

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The NSE Nifty 50 index has rallied 3.4 per cent thus far in the September month series. The NSE benchmark has logged a gain in 12 out of 13 trading sessions, and is now quoting at its highest point since July 10, 2025.  Amid the current rally, foreign institutional investors (FIIs) seemed to have reduced short bets in index futures in recent trading sessions.  The NSE futures & options data shows that FIIs have net bought index futures to the tune of ₹7,737.41 crore in the last eight straight trading sessions. This is the longest net purchases streak by FIIs since early May 2025. 

FIIs trim short bets in Nifty, Bank Nifty; but remain bearish

  The NSE F&O data shows that FIIs open interest (OI) in index futures has declined by 12.5 per cent from its peak of 2.34 lakh contracts on September 10 to 2.05 lakh contracts as of Wednesday, September 17. A reduction of roughly 0.29 lakh contracts in OI. 

 

    Amid this the FIIs long-short ratio in index futures from a record low of 0.08 has improved to 0.15. The long-short ratio indicates the number of long (buy-side) open positions in index futures versus the short (sell-side) open bets.  Simply putting, the current long-short ratio of 0.15 implies that FIIs hold up to 85 per cent of their open bets on the short side of trade in index futures.  Having said that, in recent days, FIIs OI in Nifty futures has declined by 13.1 per cent from its peak in the September series; and OI in Bank Nifty futures and MidCap Nifty futures was down by 19.5 per cent and 4.3 per cent, respectively. Thus suggesting possible reduction in existing short positions. 

What are DIIs, retail investors holding in F&O?

  Meanwhile, domestic institutional investors (DIIs) long-short ratio in index futures stands at 2.03 and retail investors 2.37. Both these segments are seen holding more than 2 bullish (long) open positions in index futures for every sell-side trade. 

Market expert view on Nifty

  The derivatives setup reflects ongoing optimism, with Put writers maintaining a clear edge over call writers. Significant open interest addition of 75.55 lakh contracts at the 25,500 Nifty strike has established it as a strong resistance ceiling, while the 25,200 strike holds the highest put OI at 77.01 lakh contracts, reaffirming its role as a critical support zone, wrote Dhupesh Dhameja, Derivatives Research Analyst at SAMCO Securities in a note.  The Put-Call Ratio (PCR) eased to 1.16 from 1.30, pointing to a positive undertone, though short phases of sideways consolidation or shallow dips could act as accumulation windows.  Technically, Nifty's ability to sustain at elevated levels signals a firm shift in its primary trend toward bullish territory, said the analyst.  The consistent formation of higher lows over the past three weeks further reinforces the robust technical structure. On the daily chart, the Nifty delivered a follow-through breakout above its previous swing high, highlighting the classic shift of resistances turning into supports, explains Dhupesh Dhameja.  Momentum indicators remain constructive, with the RSI holding steady above 66, underscoring a sustained build-up of bullish strength. Any corrective pullbacks, therefore, are likely to present opportunities for accumulation, the analyst added.