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How to become a client ? (Trading & Depository)

Trading (Normal & Derivatives)
A client is required to download the application form available at the site or can submit registration form on the Home page. On receipt of registration details we shall forward an application form. On completing the formalities in application form, a client is required to forward the same to us. On verification of application form a client will be assigned client code and password.
Note:Agreement is required to be notorised.

Depository
A client is required to download the application form available at the site or can submit registration form on the Home page. On receipt of registration details we shall forward an application form. On completing the formalities in application form, a client is required to forward the same to us. On verification of application form, we shall submit the same to CDSL system and a client will be assigned 16 digit system generated Beneficiary account number with the complete kit.
Note: Agreement is required to be notorised.

Depository

Depository

What time does it take to open Demat?
Ans : Maximum 3 to 4 Days

In how many maximum names can one account opened?
Ans : Maximum 3 names can be included

If the account, say is opened in the name(s) of A and B, can shares standing in the name(s) of B and A be dematted in the Account?

Ans : Yes, by using a transposition form

Can minor be a nominee?
Ans : Yes

Is nominee's photograph and signature required?
Ans : Yes

Is it possible to switch charging schemes ? if so, when and how?
Ans : Yes, client has to submit annexure A for charge of scheme

Are bank details mandatory for Account Opening?
Ans : Yes

What are the documents required to be produced for opening account?
Ans : Identity proof
Pass port , Voter Card , Driving license , Pan Card
Address proof
Ration Card , Bank Passbook , Driving License


Frequently for dispatch of various documents ?
Ans : Statement of Transactions ,Statement of Holding & Account Ledger

Is it possible to open account under thumb impression?
Ans : Yes

Is it possible to operate Account under PoA ? If so, the standard format for PoA?
Ans : Yes

Is partial dematerialization done by companies/RTA?
Ans : Yes ,Procedure for dematerialization Client has to submit DRF along with share certificate

Is transfer-cum-demat possible?
Ans : No

Demat Eligibility?
Ans : 1] Equity Status 2] Preference status 3] Debentures 4] Bonds 5] Mutual Fund Scheme

Commodities

What is a commodity market?
Ans : A commodity market facilitates trading in various commodities. It may be a spot or a derivatives market. In spot market, commodities are bought and sold for immediate delivery, whereas in derivatives market, various financial instruments based on commodities are traded. These financial instruments such as 'futures' are traded in exchanges.

What are commodity futures?
Ans : A commodity futures contract is an agreement between two parties to buy or sell the commodity at a future date at today's future price. Futures contracts differ from forward contracts in the sense that they are standardized and exchange traded. In other words, the parties to the contracts do not decide the terms of futures contracts; but they merely accept terms standardized by the Exchange.

Is the concept of trading in commodity futures new in India?
Ans : Commodity futures market was very much there in earlier times in India. In fact it was one the most vibrant markets till the early 70s. But due to numerous restrictions the market could not develop further. Now that most of these restrictions have been removed, there is enormous scope for the development and growth of the commodity futures market in the country.

Who regulates the commodity market?
Just as SEBI regulates the stock market, Forward Markets Commission (FMC) regulates commodity market.

Which are the major commodity exchanges in India?
There are 24 commodity exchanges in India. There are three national level commodity exchanges to trade in all permitted commodities. They are: -

1. Multi Commodity Exchange of India Ltd, Mumbai (MCX)
www.mcxindia.com
MCX is an independent and de-mutualised multi commodity exchange. MCX features amongst the world's top three bullion exchanges and top four energy exchanges. Its key shareholders are Financial Technologies (I) Ltd., State Bank of India and it's associates, National Bank for Agriculture and Rural Development (NABARD), National Stock Exchange of India Ltd. (NSE), Fid Fund (Mauritius) Ltd. - an affiliate of Fidelity International, Corporation Bank, Union Bank of India, Canara Bank, Bank of India, Bank of Baroda, HDFC Bank and SBI Life Insurance Co. Ltd.
2. National Commodity and Derivative Exchange, Mumbai (NCDEX)
www.ncdex.com
A consortium of institutions promotes NCDEX. These include the ICICI Bank Limited (ICICI Bank), Life Insurance Corporation of India (LIC), National Bank for Agriculture and Rural Development (NABARD) and National Stock Exchange of India Limited (NSE).
3. National Multi Commodity Exchange of India Ltd, Ahmedabad (NMCE)
www.nmce.com
It is the first de-mutualised electronic multi-commodity Exchange of India. Some of its key promoters are Central Warehousing Corporation (CWC), National Agricultural Co Operative Marketing Federation of India Limited (NAFED), Gujarat Agro Industries Corporation Limited (GAIC) and Punjab National Bank (PNB).

Why invest in commodities?
Trading in commodity futures is transparent and a process of fair price discovery is ensured through large-scale participation. The largeparticipation also reflects views and expectations of a wider section of people concerned withthat commodity.Producers, traders and processors, exporters/importers get an online platform through MCX / NCDEX for price risk management. It provides a platform for producers to hedge their positions according to their exposure in physical commodity.

Comparison between Commodities and Equities
Commodity Futures Equity Futures
Regulator FMC SEBI
Exchanges NCDEX, MCX BSE, NSE
Assets Metals, Energy & Agro Commodities Stocks
Sales Tax Applicable Not Applicable
Delivery Physical / Cash Settlement Cash Settlement
Quality Applicable Not Applicable Applicable
Working Days Mon to Sat Mon to Fri
Timing 10 am - 11.55 pm / 10am , 2.pm( Sat.) 9 am - 3.30 pm

What are the tradable commodities?
Bullion Gold and Silver
Oil & Oilseeds Castor Seeds, Soy Seeds, Castor Oil, Refined Soy Oil, Soy meal, Crude Palm Oil,Groundnut Oil, Mustard Seed, Mustard Seed Oil, Cottonseed Oilcake, Cottonseed
Spices Pepper, Red Chilli, Jeera, Turmeric, Cardamom
Metals Steel Long, Steel Flat, Copper, Nickel, Tin, Steel, Aluminium Zinc ingots
Fibre Kapas, Long Staple Cotton, Medium Staple Cotton
Pulses Chana, Urad, Yellow Peas, Tur, Yellow Peas
Grains Rice, Basmati Rice, Wheat, Maize, Sarbati Rice, Jeera
Energy Crude Oil, Natural Gas, Brent Crude
Others Rubber, Guar Seed, Guar gum, Cashew, Cashew Kernel, Sugar, Gur, Coffee, Silk,Sugar.

How many months contract will be available for futures trading?
Ans : Normally, at the NCDEX three consecutive calendar month contracts will be available. The MCX is providing different number of contracts for different commodities. For example, in gold there are six contracts in a year (February, April, June, August, October and December) but at a time only three contracts are open for trading.

How to start trading in Commodities?
Ans : To trade in commodities, you need to
1. Open a trading account with Bansal Comtrade Pvt Ltd
2. Complete required KYC norms

Currency

What is Forex?
Foreign exchange is the simultaneous buying of one currency and selling of another. Currencies are traded through a broker or dealer and are executed in currency pairs. For example: the Euro and the US Dollar (EUR/USD) or the British Pound and the Japanese Yen (GBP/JPY). The Foreign Exchange Market (Forex) is the largest financial market in the world, with a daily volume of over $4 trillion. This is more than three times the total amount of the stocks and futures markets combined. Unlike other financial markets, the Forex spot market has neither a physical location nor a central exchange. It operates through an electronic network of banks, corporations, and individuals trading one currency for another. The lack of a physical exchange enables the Forex market to operate on a 24-hour basis, spanning from one time zone to another across the major financial centers. This fact - that there is no centralized exchange - is important to keep in mind as it permeates all aspects of the Forex experience.

What is a Spot Market?
A Spot Market is any market that deals in the current price of a financial instrument. Futures markets, such as the Chicago Mercantile Exchange (CME), National Stock Exchange (NSE), MCX' SX, BSE offer currency futures contracts whose delivery dates may span several months into the future. Settlement of Forex spot transactions usually occurs within two business days.

Who trades in Foreign Exchanges?
There are two main groups that trade in currencies. About 5-10% of daily volume is from companies and governments that buy or sell products and services in a foreign country and must subsequently convert profits made in foreign currencies into their own domestic currency in the course of doing business. This is primarily hedging activity. The other 90-95% consists of investors trading for profit, or speculation. Speculators range from large banks trading 10,000,000 million currency units or more and the home-based operator trading perhaps 10,000 units or less. Today, importers and exporters, international portfolio managers, multinational corporations, speculators, day traders, long-term holders, and hedge funds all use the FOREX market to pay for goods and services, to transact in financial assets, or to reduce the risk of currency movements by hedging their exposure in other markets. The speculator trades to make a profit by purchasing one currency and simultaneously selling another. The hedger trades to protect his or her margin on an international sale from adverse currency fluctuations. The hedger has an intrinsic interest in one side of the market or the other. The speculator does not.

Who can trade in Currency Futures markets in India?
Any resident Indian or company including banks and financial institutions can participate in the futures market. However, at present, Foreign Institutional Investors (FIIs) and Non-Resident Indians (NRIs) are not permitted to participate in currency futures market.

What are the major fundamental factors that affect currency movements?
1. Trade Balance :- This refers to imports and exports, and is probably the most important determinant of a currency's value. When imports are greater than exports, you have a trade deficit. When exports are greater than imports, you have a surplus. A shift in the trade balance between two countries tends to weaken the currency of the country with greater deficit
2. Wealth :- Wealth is a country's reserves, in the form of gold, cash, natural resources, and so on. Any factor that affects a country's ability to repay loans, finance imports, and affect investments affects the market's perception of its currency and the currency's value.
3. Internal Budget Deficit or Surplus :- A country running a current account deficit has, on balance, a weaker currency than one that runs a budget surplus. This is tricky, however, in that the direction of the surplus or deficit affects perceptions and currency valuations too.
4. Interest Rates :- Funds travel globally in electronic format responding to changes in short-term interest rates. If three-month interest rates in Germany are running 1% less than three-month rates in the United States, then all other things being equal, 'hot money' flows out of Euro into the Dollar.
5. Inflation :- Inflation in each country and inflationary expectations, affect currency values.
6. Political factors :- Taxes, stability and other factors that affect the international trade of a country or the perception of 'soundness' of the currency affect its valuation.

Trading Procedure & Settlements

Will Bansal Finstock handles all my problems arising with the exchange?
Yes, Bansalonline will take care of any issues that arise with the exchanges on its customers behalf e.g. short deliveries, bad deliveries etc

What is the settlement procedure ?
Rolling /Normal settlement transactions are squared on daily basis And Delivery of securities settled on T+2 Basis.

If I have purchased the share, do I have to take delivery?
No you can choose to sell the share before the end of settlement cycle. However once the settlement cycle is over you have to take delivery by paying for it.

I have bought some shares but shares have not come into my demat account?
The shares will come into your demat account once the settlement takes place. Hence generally you can expect the shares to come into your Demat account on T+2 Basis of settlement cycle. In case you do not receive the shares, it may be due to the stock being in 'No Delivery' period . In this case the shares will come from the exchange after the 'No Delivery' period is over which could be 1 week away. Alternatively, it is possible that the shares may not have come from the exchange because of shortage. In this case, the exchange conducts an auction and the shares may be received a few days later.

What is an auction?
An auction is a mechanism utilised by the exchange to fulfil its obligation towards the buying trading members. Thus, in case for a settlement, the selling trading members have delivered short, their deliveries are bad or they have not rectified the company objection reported against them, the exchange purchases the requisite quantity from the market and gives them to the original buying member.

What happens if the shares are not bought in the auction?
If the shares could not be bought in the auction i.e. if the shares were not offered for sale in the auction, the Exchange squares up the transaction as per SEBI guidelines. The guideline in force stipulates that the transaction is squared up at the highest price on the relevant trading period till the auction day or at 20% above the last available closing price on the NSE/Bse, whichever is higher. The pay-in and pay-out of funds for auction square up is held along with the pay-out for the relevant auction. ( T + 4 )

What is a Disclose Quantity (DQ) order?
The system provides a facility for entering orders with quantity conditions: DQ order allows the member to disclose only a part of the order quantity to the market. DQ (Disclosed Quantity) should not be less that 10% of the Order Quantity and at the same time should not be greater than or equal to the Order Quantity.

What is a Stop Loss order ?
A stop loss order allows the trading member to place an order which gets activated only when the last traded price (LTP) of the share is reached or crosses a threshold price called trigger price. For example, you have a sold position in some security whose current price as of now is Rs.500. You would not like to buy the scrip for more than Rs.510 later in case the market goes against you i.e. go up. You would then put a SL Buy order with a Limit Price of Rs.510. You may choose to give a trigger price of Rs.505 in which case the order will get triggered into the market when the last traded price hits Rs.505 or above. Incase of a SL sell order, you may stop your losses beyond Rs.490 if the market falls by giving a limit price of Rs. 490 with a trigger price of Rs.495.

Margin

Is Margin Mandatory ?
Yes to trade with us. You have to deposit upfront margin with us.

How Much Is The Margin ?
Depending upon the trading limits and client profile.

General

How will I know the status of my accounts?
Complete details about your Bank, demat and e-broking account shall be available toyou online 24 hours a day through the Internet. You will also be able to access all details regarding your orders and trades, trading confirmations, financial account statement, transaction statements, holding statements online.

Who are eligible to participate in internet trading?
All Indian Residents/ Corporates, Non Indian residents, overseas corporate bodies and FIIs are eligible.