Trading or Investing ?? New Rules you should know!

Sebi Guidelines
Traders and Investors.. Its always important to keep yourself updated with the things you love to do.
If you love trading or investing in Indian Stock Market, well there's a news for you to consider.

Couple of new rules will be introduced and it likely to be effective from 1st Aug 2020.  What are those? Lets see..

1. Margin Shortage Penalty will also be applicable in Cash segment.

As per SEBI regulations, margin shortage penalty is levied on overnight positions held in trading account without sufficient margin as prescribed by exchange.  Till now it was levied in Equity Derivatives, Currency Derivatives and Commodity derivatives segments. From now on it will be applicable in Cash Segment as well.

2. Intraday losses and margins in delivery have to be paid in ADVANCE

Delivery payment has to be made in T + 2 only, but margin has to be kept in advance from now on.
Example : Earlier you if you have 10000 in your account and you take a short term position (usually 1-2 days) with shares worth 30000, it wasn't necessary to keep 30000 in the account and it was fine to make full payment on 3rd day ( Traded + 2).  But now on you have to keep 30000 in the account while placing that trade.

Here even if you make RTGS of flower payment in the morning on the next day(on 2nd Day of trade), margin shortage penalty will be levied.

In my opinion, there must be sufficient margin in the account before making any deal otherwise penalty will be levied. How much is the penalty? Click below link :

Know more

If you buy shares then in two days (T + 2) you gets the stock from the stock exchange. Now if you have made full payment of these shares, these shares should be credited to your Demat within 3 hours. But if payment has not been made, shares will be kept in the broker's CUSA (Client Unpaid Securities Account). If you do not make necessary payment within 5 days, broker needs to sell your shares held in his CUSA otherwise broker will be penalized until broker sells them or you make a payment against it.

Another thing to note:
If you do not make any deal(buy / sell) for 15 consecutive months, then the account will be marked inactive and you have to do RE-KYC. Usually it takes 1-2 days, (2-5 days by considering Covid 19 situation)

Bottom line :
Keep your account funded enough to hold your intraday / positional trades and investments safe and sound. And do make trades / investments once in a while to avoid deactivating your account.

Keep Maximizing Potential of Your Rupee.!! Happy Trading / Investing..! 


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