When the markets were tanking on 21st and 22nd January 2008, many brokers' terminals were closed. I could not trade through my online account with a reputed broker for most part of these 2 days, because of margin problems created by the broker and the speculators ruling the markets. This is despite the fact that I had sufficient cash with me and the broker had a lien on my bank account. There are also cases of delay in crediting the shares purchased by the investors to their respective accounts, even after you have paid for them. I have received such complaints from several investors across the country. If you have faced any such problem please post your comment to this message.
This is a sorry state of affairs:
- Why should a genuine investor suffer due the defaults made by another section of players ie. 'the speculators'?
- Why should brokers be allowed to play with the money of their clients?
- Why should brokers be allowed to run online trading activity if their sites cannot handle the traffic?
Market watchdog SEBI has to address these issues. Some suggestions to SEBI could be:
1. Instruct brokers to seggregate Margin Trading and Delivery based trading. Delivery based investors should be given priority over margin traders.
2. Brokers disallowing trading to genuine investors should be penalised heavily, but not at the cost of investors.
3. All online trading systems of individual brokers should be monitored by an independent agency. Brokers should not be permitted to add accounts in excess of their ability to handle the traffic.
Please respond to this call and send in your suggestions, so that the matter can be suitably taken up with SEBI in due course.
1 comment:
Dear Vivek
Your blogs are interesting and I hope to be a regular visitor. Regarding issues addressed in this blog,I must say that everyone is at fault,from investors who create undue large positions in futures with little risk appetite,brokers, exchange but most important the government.I had always believed that indian markets are immature and this was proved when I was not able to take any new positions.But Worst was when my options for which I had paid the premium got liquidated by exchange at the lowest level and later on which came into profits.This was a joke well played by a rotten system.
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