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IPF, Trading, Membership and Listing

(Listing) Listing is a kind of financial instrument, when a private company decide to grow their funds and go to public.
On that time the company name need to list in any exchanges like BSE or NSE. To listing into exchanges, need to satisfy some basic criteria created by exchanges. And need to pay the exchanges entry fee and annually listing fees.
After listing the company in exchanges to secondary market, the company shares can trade by people.

(Membership) Membership means getting a member rights from exchanges. For getting membership rights need to fill appropriate form and sending back to exchanges for verification. After verification, exchanges will provide the membership right.

A member or a broker can helps people to buy/sell securities in the stock market and charge some amount for fees like brokerage.

(Trading) Trading means buying/ selling securities in the stock market. It is up different tyeps.

Intraday: – Buying or selling securities within same day.
Swing: – Buying or selling securities within 10 days.
Positional: – Buying or selling securities within 100 days.
Long Term: – Buying or selling securities within 1000 days.

(Investor Protection Fund) What will happen to you, when you will not receive your money after buy or sell securities from broker member of NSE or BSE? To protect investor such kind of inconvenient incidents, NSE and BSE set up one fund is known as “Investor Protection Fund (IPF)”.

Features of IPF: –

  • Collection Fund: All the money collected from council tax and business rates is paid into the Collection Fund.
  • Current Compensation available-Presently the maximum compensation available for investor is Rs.10,00,000 but it will be reviewed as and when so desire. For example compensation was Rs. 5,000 in the year of 1988 but now it stands to Rs.10,00,000
  • Fund Management: Funds management is the management of the cashflow of a financial institution. The funds manager ensures that the maturity schedules of the deposits coincide with the demand for loans. To do this, the manager looks at both theliabilities and the assets that influence the bank’s ability to issue credit.
  • Few important things about settlement of claims:
    1. Claim will be settled after producing the relevant proof of transactions like payment or delivery. Hence proof of document is a must.
    2. But for orders or trades recorded on the ATS of the Exchange, may also be treated as the proof of transactions and for which no other proof presentation is required.
    3. Claims are settled for actual loss which includes any difference receivable by the claimant arising out of the transactions. But you will not receive any amount for the damage, interest or notional losses.
    4. Claim must be furnished in the prescribed form which is available at the time of claiming.

Professional Investor: –

  • Trade with Solid Education
  • Always Use Stop loss
  • Excellent Discipline
  • Planned before investment
  • Proven System
  • Trades without Emotion
  • Trades Non-Volatile stocks

(Image Courtesy: pixabay.com/en/euro-bill-currency-ball-about-447209/)

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