Broker can sell the stock on Margin Trading.

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Share brokers will be able to sell the shares in their account without the permission of the investors in case they have to maintain the prescribed margin limit.

Such provision has been made in the First Amendment 2077 of the Procedure on Margin Trading Facility implemented by the Nepal Stock Exchange.argin trading facility

If the actual margin of the margin account of the investor using margin trading facility is less than 20 percent, Broker can sell the stock without permission of Investor.

Within the second working day of the margin call, the concerned investor will have to deposit cash or margin tradable securities and maintain the actual margin above 20 percent.

If within the third working day of the margin call the concerned investor does not exceed the actual margin above 20 percent or due to change in market value of securities under margin account, the margin cannot be maintained above 20 percent. Arrangements have been made to sell securities.

However, no matter what is written in the articles and sub-sections of the procedure, if the actual margin of the investor in the margin account falls to 15 percent or less at any time after making the margin call, the member broker can sell the securities required to maintain the actual margin above 20 percent in the investor’s margin account. In this way, the permission of the investor is not required to be taken while selling the securities.

Similarly, if the actual margin is less than the maintenance margin, the member broker will be able to call a certain percentage margin to maintain the actual margin above the actual margin by giving 7 working days. If the entrepreneur fails to maintain the specified margin within 7 working days, he can sell any securities under the margin account required to maintain above the actual margin maintenance margin after the eighth working day or 5 days before the closing of the account.For this purpose, if the actual margin falls below 15 percent due to the margin specified by the entrepreneur or the market declines in the same period, the member broker entrepreneur may sell the securities without the permission of the investor to maintain the actual margin above 20 percent.

In case the trading of securities under margin account is closed due to merger, acquisition or any other reason, if the group indicator containing the securities falls by more than 15%, the member broker may inform the concerned investor within 7 days to repay the margin loan or other related liabilities. Provision has also been made in the revised procedure.

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