Wednesday, June 5, 2013
Dealing with MCX Members
· Trade only through Registered Members of the Exchange. Check from the Exchange website at http://www.mcxindia.com/SitePages/MembersDetails.aspx to see whether the Member is registered with the Exchange.
· Insist on filling up a standard 'Know Your Client (KYC)' form before you commence trading
· Insist on getting a Unique Client Code (UCC) and ensure all your trades are done under the said UCC.
· Insist on filling up a standard ‘Member-Client Agreement’.
· Insist on reading and signing a standard 'Risk Disclosure Agreement'.
· Obtain a copy of your KYC, Member-Client Agreement and/ or other documents executed by you with the Member, from the Member.
· Cross check the genuineness of trades carried out at MCX through the trade verification facility available on MCX website. The trades can be verified online at http://www.mcxindia.com/SitePages/TradeVerification.aspx where trade information is available up to 5 working days from the trade date.
· Insist on a duly signed Contract Note in specified format for every executed trade within 24 hours of trade, highlighting the details of the trade along with your UCC.
· Ensure that the Contract Note contains all the relevant information such as Member Registration Number, Order No., Order Date, Order time, Trade No., Trade rate, Quantity, Arbitration Clause, etc.
· Obtain receipt for collaterals deposited with the Member towards margins.
· Go through the Rules, Bye-laws, Regulations, Circulars, Directives, Notifications of the Exchange as well as of the Regulators, Government and other authorities and details of Client-Trading Member Agreement to know your rights and duties vis-à-vis those of the Member.
· Ask all relevant questions and clear your doubts with your Member before transacting.
· Insist on receiving the bills for every settlement.
· Insist on Monthly statements of your ledger account and report any discrepancies in the statement to your Member within 7 working days. In case of unsatisfactory response report the discrepancy to the Exchange within 15 working days from the date of cause of action.
· Scrutinize minutely both the transaction & holding statements that you receive from your Depository Participant.
· Keep Delivery Instruction Slips (DIS) book issued by DPs in safe possession.
· Ensure that the DIS numbers are preprinted and your account number (UCC) is mentioned in the DIS book.
· Freeze your Demat account in case of your absence for longer duration or in case of not using the account frequently.
· Pay required margins in time and only by Cheque and ask for receipt thereof from the Member.
· Deliver the commodities in case of sale or pay the money in case of purchase within the time prescribed.
· Understand and comply with accounting standards for derivatives.
· Do not deal with any unregistered intermediaries.
· Do not undertake off-market transactions as such transactions are illegal and fall outside the jurisdiction of the Exchange.
· Do not enter into assured returns arrangement with any Member
· Do not get carried away by luring advertisements, rumours, hot tips, explicit/ implicit promise of returns, etc.
· Do not make payments in cash/ take any cash towards margins and settlement to/ from the Member.
· Do not start trading before reading and understanding the Risk Disclosure Agreement and entering into the prescribed agreement with the Member.
· Do not neglect to set out in writing, orders for higher value given over phone.
· Do not accept unsigned/duplicate contract note/confirmation memo.
· Do not accept contract note/confirmation memo signed by any unauthorized person.
· Do not delay payment/deliveries of commodities to Member.
· Do not forget to take note of risks involved in the investments.
· Do not sign blank Delivery Instruction Slips (DIS) while furnishing securities deposits and/or keep them with Depository Participants (DP) or broker to save time.Do not pay brokerage in excess of that rates prescribed by the Exchange
Posted by www.vogaz.com at 11:26 AM