SEBI's new move to cut retailers participation in F&O!

[headstrong007]

I don't think liquidity will decrease so much that sl-m orders will be risky .

It will decrease heavily on stock specific futures and options depending on margin and current volume and spread.
Already not all stock options are liquid enough for high volume Market Order.

For the index futures market order will execute as before but with less volume obviously, the cost of impact will be much more for volume traders. Actual breakeven will be much higher due to slippage.
The broker will try to block market order on stock specific options.

Why it is dangerous to trade with stock specific F&O where liquidity will dry out??
Bcoz u will see sudden volatility spike which will take your stop losses frequently. Trailing stop losses will be hit frequently also. Overall trading will be more difficult in reality.
30-50% margin increase mean volume will certainly drop for stock specific f&o.

 

[hitesh05]

It will decrease heavily on stock specific futures and options depending on margin and current volume and spread.
Already not all stock options are liquid enough for high volume Market Order.

For the index futures market order will execute as before but with less volume obviously, the cost of impact will be much more for volume traders. Actual breakeven will be much higher due to slippage.
The broker will try to block market order on stock specific options.

Why it is dangerous to trade with stock specific F&O where liquidity will dry out??
Bcoz u will see sudden volatility spike which will take your stop losses frequently. Trailing stop losses will be hit frequently also. Overall trading will be more difficult in reality.
30-50% margin increase mean volume will certainly drop for stock specific f&o.

I agree with you, but will it affect index futures and top 20 active stocks?

 

[XRAY27]

Don't you trade intraday in cash?

I don't think liquidity will decrease so much that sl-m orders will be risky .

I don't trade cash market.it is less profitable vis a vis FNO index trading, SL-M orders slippage already increased in index futs,which is my experience july and Aug

 

[VJAY]

I don't trade cash in intra..it is also less profitable vis a vis FNO index trading, SL-M orders slippage already increased in index futs,which is my experience july and Aug

Yes true...

 

[afin]

I agree with you, but will it affect index futures and top 20 active stocks?

Seems like cash market is the way forward for all of us including index options/ futures.

 

[timepass]

Let's see how it affects bracket orders. Today, one lot of BNF using BO requires 16-18K margin. Maybe that will increase to 20k

 

[hitesh05]

Let's see how it affects bracket orders. Today, one lot of BNF using BO requires 16-18K margin. Maybe that will increase to 20k

If that so then we can survive but what about net worth?

 

[VJAY]

If that so then we can survive but what about net worth?

IMO networth issue they not do this time as they allready increasing margin in f&o....also most of brokers opposed about networth thing

 

[vikas2131]

IMO networth issue they not do this time as they allready increasing margin in f&o....also most of brokers opposed about networth thing

i hope you are right. If they did both, it will become a nightmare to trade for us. On the other hand i would not be surprised if they increased the margin even more.

 

[afin]

i hope you are right. If they did both, it will become a nightmare to trade for us. On the other hand i would not be surprised if they increased the margin even more.

i am hoping for this too. At the moment given the options SEBI is throwing at us, I won't mind the higher margins - atleast the cash market would be untouched. It is like the best of the worst possible outcomes I guess.