Day trading on regulators radar

Day trading on regulators radar

Posted: glevit Date: 06.06.2017

It had concluded there was a need for regulating day trading activity in a better way, as unregulated or loosely regulated day trading could pose several challenges. In the equity market, proper compliance with margin deposit rules by day traders could solve some problems. Several brokers are allowing limitless day orders, subject to their being squared off by the end of the day. In commodities, the test of success of futures contracts lies in open interest OI, or the total of derivatives contracts not closed or delivered on a particular day.

They also use a variety of trading strategies like momentum strategy, contrarian investing, index arbitrage, statistical arbitrage, merger arbitrage, range trading, scalping, etc. In the US in May , flash crashes due to rapid withdrawal of these traders had amplified the risk and intensified a liquidity crisis.

WHAT IS DAY TRADING? Day trading is defined as buying and selling of securities of similar quantity and type on the same day with the intention to close square off position before end of the day Day trading regulations in emerging markets INDIA Only a negative list of securities is issued known as trade for trade where day trading is not allowed.

On the National Stock Exchange, algorithm trading accounts for Even of the daily volumes of actively traded Nifty stocks, net delivery is only around 25 per cent. This was even lower at 20 per cent in early , when the market was at its low, after the global crisis.

In some stocks, net deliveries are as low as 10 per cent. In emerging markets in general, says IOSCO, day trading increased between and but dipped between and It has not given any updates after that.

When asked, a spokesperson of the Securities and Exchange Board of India said they were studying these recommendations. The spokesperson for the commodity futures market regulator, the Forward Markets Commission, said: In terms of trading cost, the Indian market is at par with or better than the world markets but the impact costs here are much higher.

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Hence, to ensure they remain active in the market, there is a need for regulations. The key thing in the regulation should be to ensure that they pay proper and timely margins. Day trading is a profession; however, said Sood. To make real money from equities, investors should remain choosy and long-term.

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Day trading in financial markets is posing regulatory challenges, and the capital market and commodity futures market regulators are considering a higher degree of rules on these. Upgrade To Premium Services. Business Standard is happy to inform you of the launch of "Business Standard Premium Services". As a premium subscriber you get an across device unfettered access to a range of services which include:. Welcome to the premium services of Business Standard brought to you courtesy FIS.

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Enter the characters shown in the image. Send me a copy: Day trading is defined as buying and selling of securities of similar quantity and type on the same day with the intention to close square off position before end of the day. Day trading regulations in emerging markets INDIA Only a negative list of securities is issued known as trade for trade where day trading is not allowed.

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