Raga Shares Trading Pvt. Ltd. Raga Complex, Behind Amrit Complex, Corporation Road, Jabalpur (M.P.)

Transcription

1 Procedures 1. Client Registration & Document Maintenance We follow a well-structured procedure for registration of client, which is as follows- 1. Introduction of Client: - Clients comes into our contact by two means, either on their own or through marketing personnel. On both occasions client will be introduced to our accounts opening department. 2. Explanation of Risk Disclosure Document and Client Broker Agreement: - Our account opening dept. along with marketing personnel explains about risk involved in capital market to the client. He will also come to know about Risk Disclosure Document and Client Broker Agreement. 3. Verification of Clients Document: - Our personnel through concerned authorities have verified all the documents produced by the clients. 4. Form Filling & UCC Registration: - After satisfying in all aspects from client, he will be allowed to fill the form. In which he will sign all the related documents. Duly filled form paves the way for UCC registration of Clients. 5. Document Maintenance: - After UCC registration the form is sent to Record Room. The duly filled form is kept in Record Room and indexed there. All these steps have been performed under the able supervision of our Director Mr. Ram Asrani. 2. Sales Practices Followed by Trading Member In our company we generally do not make any special efforts for marketing. The clients are either comes walk-in or through reference of existing clients/ The Director. 3. Closure Of Accounts / Dormant Accounts If client wish to close his trading account then client has to give Account Closure request in prescribed format also in handwritten application in this subject. After receipt of such application, it will be sent to the accounts department to verify whether any credit/debit is standing in the particular trading account or not. If so then same will be cleared either by receiving cheque of the debit balance or paying the cheque of credit balance. Then same application is sent to DP operations department to check the Beneficiary/pool account status if

2 any security/share is found in clients beneficiary then same will be transferred to the designated demat account of the client. After this the trading code is deactivated for trading. Also we fulfill the closure related procedure of the Exchange. After this one confirmation letter is sent to client of his/her account closure. 4. Order Receipt and Execution. In our office client gives their order either on their own while sitting in front of terminal or through telephone. On telephone they contact their remisier or relationship managers for placing their orders. After accepting orders from concerned client it has been routed to dealer attached with remisier or relationship manager. Before entering order in the terminal clients authenticity has been verified through remisier and relationship manager. 5. Sending Contract Notes, Daily Margin statement, Quarterly Statement of Accounts to clients We send the Digital Contract notes to the clients have opted for the same. Also the daily margin statement is informed to the clients on telephonic basis. Also we have adopted a practice to send the Quarterly Statement of Fund and Securities either by courier or by hand delivery to some clients. We request them to give the confirmation signature on the same and return back to us. We maintain this copy in our record. 6. Collection of pay in, margin, limits setting for exposures & turnover for clients, terminals, branches & sub-broker level Initial Margin Collection Initial minimum margin shall be taken from all the clients. Accordingly the exposure limit shall be set. It can be in the form of cheque or by share pledge. At the time of share pledge, the value of closing price of share of the previous day shall be considered & effect of margin share capital provided to client for daily trading after deduction of haircut of 40 %. Client cash margin bank accounts shall be maintained separately in Capital Market segment & in F&O segment

3 The trade of new client shall be executed after cash margin clearance of cheque by the bank confirmation of share pledge given by the DP department of the Company. Margin registers shall be maintained by the Accounts Department (soft & hard copy) for cash margin deposit or share margin deposit. Bank clearance cheque shall be followed through accounting system and the effect shall be given to the right client account through proper scrutiny. Day To Day Operation After opening of the client account in the back office, the capital limit for the client in the front office trading terminal server shall be set according to margin deposit. Before market hour, the Exchange information for free fresh trading capital shall be checked on a daily basis Margin Collection & Reporting Exchange data regarding margin levied by the Exchange for T+1 or T+2 days & in F&O segment, Span margin levied by the Exchange shall be informed to the clients via mail and margin reported MG 13 file shall be uploaded to the Exchange after collection of margin & updated figure according to client books shall be provided to the Exchange on a regular basis. Separately from back office side, the information to the client for margin collection shall be sent with in T+0 or T+1 day end. Any margin shortfall reported by the client shall be produced to the Exchange (for MG 13 reporting) and side by side trade exposure shall be reduced by squaring up trade or by locking the client account and accordingly the information shall be sent to the client. Any penalty levied by the Exchange shall pass on to client account on giving prior intimation to the client. 7. Monitoring Debit Balances The cheque can be either collected from the client or if the client deposited it directly in the bank of the Company, the effect in the client account shall be done only after verification in the bank book or bank deposit slip. The high value trade of both buy & sale side shall be treated cautiously and therefore early pay in & pay out funds or securities shall be done accordingly and also the benefit arises shall pass on to the client accordingly. Any additional margin levied by the Exchange shall be informed to the client & if any credit balance is available in the client's account, it shall be utilized for utilization of margin. If any cheque given by the client gets dishonored, it shall be taken care of before the fund pay out day. Also for the time being, client account shall be locked/freeze to avoid further trades by the said client and accordingly the client or the dealer shall be informed about the insufficiency of funds.

4 Pay out of securities shall be done to the system-generated procedure & only after verification of the same, the shares should be released according to credit position or on receipt of cheque from them. If any debit balance is lying in the client's ledger the shares shall be kept in the beneficiary account of the Company. These shares shall be released only on the receipt of payment by the client. Auction of share shall be regularly followed and shall reported to the client and prior intimation to the client for pay in arrangement shall be made and after failure report client's fund shall be kept separately more then average 20 % and money shall be kept in the settlement account of the Company for Exchange account purpose. The analysis of the debit client management shall be done by the system generated ageing report on weekly basis. The track record for allocation of fund & share shall be kept separately as own account & client account. The cheque shall be collected from client with in T+0 or T+1 day on day trading loss for trade or MTM loss. For collection of payment relationship manager will call their clients and give confirmation to them about their trades. 8. Payment, Receipt of fund from/to clients For release of payment clients give their request to our account department, which has been counter verified through our DP departments for valid payouts and holding position. After satisfying from all aspects account department will issue account payee cheque to clients, which has been signed and validated by our Director. On acceptance of cheque our account department will issue proper receipts to clients with amount and cheque no. 9. Receipt, Delivery of Securities from / to clients As soon as trading and billing has been completed for the settlement DP department will find the possible pay out and pay in of securities to and from the clients DP personnel will give calls to respective clients for collection of securities for pay in to the stock exchange. If clients wish to have Securities in their DP account they will give written request to DP department, which will be counter verified through our account department for fund position of client. If there is no due left on the client DP instruction will be issued for the same. This instruction will be counter signed and verified by our Director.

5 10. Square off of positions / Liquidation of securities without consent of clients In case of uncertain and extreme volatility in market broker has to square off/liquidate the clients position. In current scenario if we are not receiving the margins/dues after margin calls then we have to square off/ liquidate the position of the client. 11. Policy for internal shortages The policy and procedure for settlement of shortages in obligations arising out of internal netting of trades is as under: (a) Short Delivery to the Exchange for scrip at the broker level: Incase of short delivery to exchange, the settlement happens as per the auction/close-out mechanism of Exchange and auction/close-out debit is passed to the defaulting clients who did not fulfill his selling obligation. (b) Short delivery of pay-out to clients who bought the scrip on that day (Client to Client shortage): The shares delivered short will be purchased on next day after the pay-in date i.e. on T+3 from Normal Market and the purchase consideration amount will be debited to the defaulting clients. If the covering rate (internal shortage repurchase) is more than the actual sell rate on T day, the difference amount will be borne by the defaulting client on sell side. If the covering rate (internal shortage repurchase) is less than the actual sell rate on T day, the difference amount will be debited to the defaulting client on sell side and credited in a separate account maintained with Raga shares Trading Pvt Ltd. Further if RAGA is unable to buy shares on T+3 day from normal market due to upper side freeze on the scrip or any other reason, the defaulting seller will be debited at the close-out rate and the corresponding buyer will be credited by equivalent amount. The close-out rate will be the highest between the trade date and (T+3) date or 20% above the official closing price on the (T+3) day, whichever is higher. Further if the shares covered against client to client shortages is again received short from any client, the trade will be settled by the close-out debit to seller client and corresponding buyer for whom the shares were covered will be credited by equivalent amount. The close-out rate will be the highest rate between the repurchase date (T day) and auction date i.e. (Repurchase date +3) day or 20% above the official closing price on the auction day, whichever is higher. If the shares repurchased against client to client shortages received short from Exchange, the settlement happens as per the auction/close-out mechanism of exchange. (c) Mechanism of choosing corresponding clients on the buy side: Corresponding clients on the buy side of scrip A are chosen on the basis of the descending quantity of shares bought by them i.e. first the client (say X) who has purchased highest quantity of scrip A will be picked up and if the shortage of shares is more than the

6 quantity of shares bought by the client X, then the client who has purchased the next highest quantity will be picked up so on and so forth. The shares bought on T+3 in case of Client to Client shortage and shares/credit received from Exchange through auction process in case of broker level shortage are credited to the corresponding client on buy side of scrip A chosen through the aforesaid mechanism. 12. Transfer Of Trades In case of ay mistake by the dealer while punching the order then broker requires to modify the trade in post closing. The same if any will be done by the Compliance Officer and will be conveyed to the respective department of the exchange. 13. Investor Redresal Mechanism If any client has any grievances or complaint then the client can register his/her complaint in the Grievance Register kept with the compliance officer also the client can mail the complaint on [email protected] The Id is given on our Web Page PMLA The PMLA policy is documented and same is annexed herewith as Annexure Power of Attorney The Company has internal policy to accept only DP Related Power of Attorney solely for the purpose of pay-in of securities. Company do not have accepted any other Power Of Attorney from its clients.

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8 Systems 1) Capacity of Systems with reference to volume We have two VSAT in place at Head Office for NSE terminals connectivity. According to the current volume scenario we have capacity to handle 5-6 times of the current volumes. Once volumes reaches to that level we will have expansion plan. 2) Connectivity to Exchange & / to branches / sub-brokers / clients We have VSATs for exchange connectivity. Currently we don t have any sub broker or branches. We have given facility of internet trading facility to the clients who signs ITORS agreement with us. 3) Back up in case of disruption of connectivity For VSAT Connectivity Back up: We have taken option of NOW TM (of NSE IT Ltd) in case of disruption in VSAT connectivity. For ITORS connectivity Back up : We have taken two separated leased lines one of 4 mbps and the Back Up leased line is of 2 mbps.