Important changes recently introduced by SEBI for trading in Futures
and Options and Currency Derivative segment.
SEBI vide its circular no. SEBI/HO/MRD/DRMNP/CIR/P/2018/75 dated May 02, 2018 and NSE vide its circular no. NSCCL/CMPT/37751 dated May 14, 2018 and NSCCL/CDS/37750 dated May 14, 2018 have asked for compulsory collection and reporting of initial margins, exposure margin, net buy premium and mark to market loss ('MTM') in Futures and Options segment and Currency derivative segment to the exchange as per the below revised guidelines.
The revised guidelines from the exchanges are as follows:
(A) Initial margin and exposure margin is required to be paid prior to
the trade.
(B) MTM losses are to be paid by T+1 day (where, 'T' refers to the trade day).
(C) MTM loss should be paid only through funds transfer/cheque.
(D) In case of shortfall in Margin or MTM, a penalty in range of 0.5% to 5% depending on the number of instances of shortfall will be levied by the Exchanges.
(E) Initial margin, exposure margin, net buy premium and MTM loss that are collected, will be reported to the exchange accordingly.
In light of the above requirements, we would like to recommend that you always keep adequate funds for MTM and collateral/funds for margin requirements in your broking account to avoid penalty.
and Options and Currency Derivative segment.
SEBI vide its circular no. SEBI/HO/MRD/DRMNP/CIR/P/2018/75 dated May 02, 2018 and NSE vide its circular no. NSCCL/CMPT/37751 dated May 14, 2018 and NSCCL/CDS/37750 dated May 14, 2018 have asked for compulsory collection and reporting of initial margins, exposure margin, net buy premium and mark to market loss ('MTM') in Futures and Options segment and Currency derivative segment to the exchange as per the below revised guidelines.
The revised guidelines from the exchanges are as follows:
(A) Initial margin and exposure margin is required to be paid prior to
the trade.
(B) MTM losses are to be paid by T+1 day (where, 'T' refers to the trade day).
(C) MTM loss should be paid only through funds transfer/cheque.
(D) In case of shortfall in Margin or MTM, a penalty in range of 0.5% to 5% depending on the number of instances of shortfall will be levied by the Exchanges.
(E) Initial margin, exposure margin, net buy premium and MTM loss that are collected, will be reported to the exchange accordingly.
In light of the above requirements, we would like to recommend that you always keep adequate funds for MTM and collateral/funds for margin requirements in your broking account to avoid penalty.
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