New Client Margin regulations of SEBI dated May 02, 2018. What it means to the Investors?


New Client  Margin regulations of SEBI dated May 02, 2018.  What it means to the Investors?

SEBI with effect from  1st June 2018 has  stipulated  increased margins so as to protect the interest of the trading members and clients at large.  This will facilitate the Clients to trade carefully with full margin and ensure that  there is no speculative  move and the risk element is  minimum. Similarly for the Brokers too, it is  a safety net against  speculative trades leading to defaults. The clients may check their contract notes daily and also ledger balances  so as to ensure their status of accounts and positions and contact the Broker for any clarification then and there.

  • Effective from 1st June 2018.
  • Clearing / Trading Members are required to collect initial and exposure margins from all clients on an upfront basis in respect of derivatives trading positions. So investors need to deposit this in advance.
  • They are also advised to collect MTM losses from clients by T+ 1 day
  • Members will report to details of initial margins, exposure margins, MTM Losses
  • Penalty for short/non reporting by member shall be as applicable at present.

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