Dear Valued Clients ,
As an experienced and professional investor and trader you would have observed that on 20.04.2020, the crude oil settlement rate went to negative on NYMEX and so also in MCX quite unexpectedly and in an unprecedented manner. This was not peculiar to us only but for all clients world over. So, any amount of margin would be insufficient under this extraordinary volatility and the liability on brokerage firms is unlimited. In view of this, we are making the following changes in our Risk Management policy for all physical delivery and cash-settled commodities as like as — Crude Oil, Natural Gas, and Crude Palm Oil (CPO).
1) Across Commodity Exchanges, contracts with all physical delivery are mandatorily closed out by 5.00 PM on the day prior to 5 working days to expiry day, else the position will start square-off by our Risk Management Team from 6.00 PM onwards. Only those who are willing to take or give delivery can continue to hold the position.
Example : For Gold, 05MAY2020 is expiry day on which the position is allowed to carry upto 5.00 PM on 28APR2020, if the position is not squared-off on or before said timing, then the position will start square-off by our Risk Management Team from 6.00 PM onwards, those who are willing to take or give delivery must provide a prior communication to RMS Team to hold the position.
2) Across Commodity Exchanges, contracts with all cash-settled commodities as likely as – Crude Oil, Natural Gas, and Crude Palm Oil (CPO) are mandatorily closed out by 5.00 PM on the expiry and no position will be allowed to carry after the said timing. If the position is not squared-off on or before said timing, then the position will start square-off by Risk Management Team from 6.00 PM onwards.
Example : For Crude Oil, 18MAY2020 is expiry day on which the position is allowed to carry upto 5.00 PM on 18MAY2020, if the position is not squared-off on or before said timing, then the position will start square-off by our Risk Management Team by 6.00 PM onwards.
3) The additional margin of 300 % of the Contract Value should be deposited with us one day prior to expiry date [If prior to a expiry date is falling on holiday, then this condition will be verified on previous working day] for all open cash-settled commodity contracts expiring the next day. Kindly note that if adequate margin as above is not provided one day prior by the client, then the position will be squared off by our Risk Management Team by 10.00 PM onwards on the same day.
Example : For Crude Oil, 18MAY2020 is expiry day on which the position will be allowed to carried over upto 09.00 PM on 17MAY2020, if the additional margin of 300 % of the Contract Value is not provided on or before said timing, then the position will start square-off by our Risk Management Team by 10.00 PM onwards on 17MAY2020.
4) Please also note that no MIS or CO or BO Product types will be permitted during the last two days of any expiry for cash-settled commodity contracts.
5) Intraday trades will be allowed with the required margin.
In case of any doubt or query please feel free to contact us at-044 40329999 or through E-Mail @ customersupport@gwcindia.in
Wishing you all safe trading.
Regards,
Team-Goodwill
