“TRADING & CLEARING MECHANISM & REGULATORY FRAMEWORK FOR FUTURES AND OPTIONS” SUBMITTED BY
(10018, 10028, 10040, 10073)
PROF. Dr SAMPADA KAPSE.
TOLANI INSTITUTE OF MANAGEMENT STUDIES
In Indian context the futures & options traded on NSE is called NEAT-F&O trading system. Entities involved in trading system are:
Professional clearing members.
National Securities Clearing Corporation Limited (NSCCL) looks after all clearing and settlement of trades executed on futures and options on NSE The three main activities of clearing and settlement process are: •
The clearing mechanism essentially involves working out open positions and obligations of clearing (self-clearing/trading-cum-clearing/professional clearing) members. This position is considered for exposure and daily margin purposes.
Securities Contracts Act 1956 of SEBI Act regulates the trading of derivatives in India. A committee was forms by SEBI to develop the appropriate regulatory framework for derivative trading in India.
Proprietary orders should be identified as “Pro” and those of clients should be identified as “Cli”. 2.
The maximum brokerage chargeable by a trading member in relation to trades effected in the contracts admitted to dealing on the F&O Segment of NSE is fixed at 2.5% of the contract value exclusive of statutory levies.
What is Day order?
A day order, as the name suggests is an order which is valid for the day on which it is entered. If the order is not executed during the day, the system cancels the order automatically at the end of the day. 4.
What is Immediate or Cancel (IOC)?
An IOC order allows the user to buy or sell a contract as soon as the order is released into the system, failing...
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