Risk Management Policy

RISK MANAGEMENT SYSTEM POLICY

Definitions: in this Policy, unless the context requires otherwise,

 1.1 RMS: RMS means Risk Management system. Risk management is to manage risk of company and clients from volatility of capital market/Currency/Commodity Market.

 1.2 Adjusted Ledger Balance: Adjusted Ledger balance means clear balance in client’s ledger account in company books. For example, proceeds of shares sold but not delivered will be reversed if credited in the ledger and debited Var Margin will be ignored.

1.3 COMMODITIES in Margin: COMMODITIES in margin means those COMMODITIES which are approved for this purpose by the Exchange given by the Client to the Company. These are transferred by clients to the Company and may further be pledged by the Company to the Exchange towards the Company’s margin obligations for the client.

1.4 Exposure of client: Exposure of Client means a client’s obligation arising out of (i) Buy and Sale entered into on behalf of the client in cash segment which are yet to be settled and (ii) open position in F O segment.

 1.5 Total Deposit: Total Deposit means aggregate of ledger balance, value of commodities after hair cut in on behalf, value of commodities after hair cut in margin and cash margin, if any, received from the client.

1.6 Concentration: Concentration means the number of each scrip arrived at application of the percentage fixed by the Company from time to time on the basis of average daily volume of trade on the exchange in that scrip during the last 30 Days.

2.Transaction offered to clients:

2.1 Intraday trades: Intraday transactions are, sale & Purchase in any scrip which are reversed by contra transaction of Purchase- Sale in the same scrip and in the same quantity, so that net quantity carried is NIL on a particular trading day

3.Risk Management:

We are having margin based Risk management system, In which total deposit of client is uploaded in system. Now client can take exposure in any scrip(s) and his deposit will be utilized (based on Gill Broking Var margin) on the particular scrip(s).

 In this margin based risk management system, client has to make payment before the time fixed by the Exchange for Pay-In. Otherwise he will be liable for consequences of square off.

Example: A client intends to trade and Ledger balance Credit Rs. 50000 and he wants applicable charges and taxes.

In case if there is a MTM call or shortage after the purchase of such XYZ commodity then he has to make payment of the remaining amount depending of MTM plus applicable Span margin before T+2 Days.

 In case if MTM loss is 20% of the available margin in carry forward position, Gill Broking Private Limited has the right to square off his position.

Further if the client decides to buy ABC Commodity on which Gill Broking will square off his intraday and as well as carry forward position and vice versa. On the MTM loss of 70% plus applicable charges and taxes.

Since the volatile nature of commodities, square off can take place above 70 % also in case Client will be legally responsible for any debit due to Gill Broking Private Limited. Gill Broking has the right to square off any trade if client fails to provide additional margin on MTM loss or Span margin plus special margin. It is the responsibility of the client to maintain additional MTM margin and Span margin from time to time as Gill Broking will square off the client trades partially or whole depending on the risk of client.

• Beware of fixed/guaranteed/regular returns/ capital protection schemes. Brokers or their authorized persons or any of their associates are not authorized to offer fixed/guaranteed/regular returns/ capital protection on your investment or authorized to enter into any loan agreement with you to pay interest on the funds offered by you. Please note that in case of default of a member claim for funds or securities given to the broker under any arrangement/ agreement of indicative return will not be accepted by the relevant Committee of the Exchange as per the approved norms.
• Ensure that pay-out of funds/securities is received in your account within 1 working day from the date of pay-out.
• Be careful while executing the PoA (Power of Attorney) – specify all the rights that the stock broker can exercise and timeframe for which PoA is valid. It may be noted that PoA is not a mandatory requirement as per SEBI / Exchanges.
• Register for online applications viz Speed-e and Easiest provided by Depositories for online delivery of securities as an alternative to PoA.

• Do not keep funds idle with the Stock Broker. Please note that your stock broker has to return the credit balance lying with them, within three working days in case you have not done any transaction within last 30 calendar days. Please note that in case of default of a Member, claim for funds and securities, without any transaction on the exchange will not be accepted by the relevant Committee of the Exchange as per the approved norms.

• Check the frequency of accounts settlement opted for. If you have opted for running account, please ensure that your broker settles your account and, in any case, not later than once in 90 days (or 30 days if you have opted for 30 days settlement). In case of declaration of trading member as defaulter, the claims of clients against such defaulter member would be subject to norms for eligibility of claims for compensation from IPF to the clients of the defaulter member. These norms are available on Exchange website at following link: NSE, MCX

• Brokers are not permitted to accept transfer of securities as margin. Securities offered as margin/ collateral MUST remain in the account of the client and can be pledged to the broker only by way of ‘margin pledge’, created in the Depository system. Clients are not permitted to place any securities with the broker or associate of the broker or authorized person of the broker for any reason. Broker can take securities belonging to clients only for settlement of securities sold by the client.

• Always keep your contact details viz. Mobile number/Email ID updated with the stock broker. Email and mobile number is mandatory and you must provide the same to your broker for updation in Exchange records. You must immediately take up the matter with Stock Broker/Exchange if you are not receiving the messages from Exchange/Depositories regularly.

• Don’t ignore any emails/SMSs received from the Exchange for trades done by you. Verify the same with the Contract notes/Statement of accounts received from your broker and report discrepancy, if any, to your broker in writing immediately and if the Stock Broker does not respond, please take this up with the Exchange/Depositories forthwith.

• Check messages sent by Exchanges on a weekly basis regarding funds and securities balances reported by the trading member, compare it with the weekly statement of account sent by broker and immediately raise a concern to the exchange if you notice a discrepancy.

• Please do not transfer funds, for the purposes of trading to anyone, including an authorized person or an associate of the broker, other than a SEBI registered Stock broker.

• Do not deal with unregistered intermediaries (who are not registered with SEBI/Exchanges).

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