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The customer can take positions in these currencies from anywhere across the country, after transferring the required margins, through his online trading account.
A currency futures contract is a standardized form of a forward contract that is traded on an exchange. It's an agreement to buy or sell a specified quantity of an underlying currency on a specified date at a specified price.
Settlement open currency trading account india the customer is, however, done in Rupee terms and not in the foreign currency. On the lines similar to equities, depending upon the perception of increase or decrease in value, the customer has to crystallize his views on the expected movement in the value of respective currencies.
Customers can then buy or sell the currencies accordingly on the currency futures trading platform. Lien marking is a unique facility offered by SBI for its clients. Through the lien marking facility offered by SBI, the client continues to receive interest on the lien amount till the actual deals are done.
In the case where the margins are transferred upfront, the client looses the opportunity to earn interest till the deals are done. Upon execution of the deal on the exchange, the lien amount is reduced and the debit entry is passed in the client's account at open currency trading account india End open currency trading account india the day.
The spread positions require lower margins specified by the Exchange, and the benefit of the lower margins, if any, would be passed on to the client. Exchange would automatically square off your position on the last day of the contract expiry.
Your position would be closed at the final settlement price as per the current regulations. The client can request for unmark of the lien at any time. The following has to be noted in this regard. We offer volume based incremental brokerage rates to suit various segments of the customers.
Our brokerage rates are straight forward and don't carry any hidden charges. Provision for lien marking. The money continues to remain in the customer's account until the deal is done, thus earning him interest. Secure and Robust online platform. Product from India's most trusted and transparent Bank. What is Currency Futures? After completion of the KYC documentation, the trading account of the client would be opened within a few days and an email would be sent to the client with the user name and password.
To trade in a currency futures contract, the client needs to give the required margins upfront to the Bank. For example if a client buys a near month contract at Rs. Thereafter, he will be redirected to a login page, where he has to enter the required details and log in. Alternatively the client can also try the URL: The updated lien amount can be seen on the onlinesbi homepage.
Placing the Trade On the lines similar to equities, depending upon the perception of increase or decrease in value, the customer has to crystallize his views on the expected movement in the value of respective currencies. Contrarily, he can 'sell' the contract if he sees appreciation of the Indian Rupee. For example, if the Rupee one month is trading at Rs. He makes a gain of Rs. In case Rupee moves against his expectations and reaches Rs.
The customer can square off his positions at any time during the period of the contract. Benifits of Trading in Currency Futures A wide range of financial market participants -hedgers i. This product offers the platform for hedging against the effects of unfavourable fluctuations in foreign exchange rates. If you are an importer you can 'buy' a currency open currency trading account india contract to "lock in" a price for your purchase of actual foreign currency at a future date.
Thus you avoid the exchange rate risk that you would have otherwise faced. If you are an exporter, you can 'sell' currency futures on the exchange platform and lock in a sale price at a future date. You have an export receivable after two months and you find the current level very attractive.
Then you can 'sell' a two months currency futures contract at the current price of Rs. So at the end of two months you get Rs. All those interested in taking a view on appreciation or depreciation of exchange rates in the short and medium term, can participate in the currency futures market. As per open currency trading account india Regulatory guidelines, all open currency trading account india Indians' including individuals, companies or financial institutions are allowed to participate in currency futures market.
The presentation about using the platform to place trades would be sent to the client via email after the opening of the SBI FX Trade account. The presentation would also be available on retail. The KYC form collects the details of the customer, which would be kept confidential by the Bank.
The Investor Rights and Obligations document specifies the right and duties of the client who wishes to open a currency futures trading account.
Risk disclosure document explains the various kinds of risks associated with the exchange traded currency futures market.
Member-client agreement is executed between customer and the trading member SBI for participating open currency trading account india the exchange traded currency futures market. This agreement has to be stamped as per the applicable stamp act, the cost of which will be borne by the client.
The agreement for sending the contract notes electronically enables the clients to receive the contract notes and other statements electronically. What is lien marking and how is it different from normal upfront transfer? How can I see the lien marked status and the updated trading limits? When the client marks a lien for placing the trades, the lien status is updated on a real time basis in the onlinesbi homepage of the client.
The client can also see the updated limits on the www. How is margin calculated on open position? Calendar spread means risk off-setting positions in contracts expiring on different dates in the same underlying taken simultaneously. How is the margin calculation done in case of calendar spread?
Open currency trading account india can I view my open positions in Currency Futures? In addition, contract notes and daily statements will open currency trading account india sent to you according to the regulatory guidelines. Can I do anything to safeguard the positions from being squared off on account of margin shortfall?
Yes, you can always voluntarily add Margin at the time of placing orders or allocate additional margin at any time. Having adequate margins can avoid calls for any additional margin in case the market turns unfavorably volatile with respect to your position. Intra Day Trigger Points The client would receive the alerts at the following levels, for topping up his margin account.
No Trigger Point Action Taken 1. It's always advisable for the clients to keep an additional cushion over the required margin to reduce the possibility of such a square off, on account of extreme market movements. If the client fails to top up at this level open currency trading account india, the Bank reserves the right to square off the positions of the client.
Every day the settlement of open Currency futures position takes place at open currency trading account india Settlement Price declared by the exchanges for that day.
The Base price is compared with the Settlement price and difference is cash settled. What are my settlement obligations in currency futures? You can have following two Settlement obligations in Currency futures market: PayIn due to Brokerage and statutory levies on close out PayIn due to applicable Open currency trading account india Is it compulsory to square off the position within the life of contract?
When is the obligation amount debited or credited in my bank account? Daily Settlement Obligations at Bank: This means that any daily obligation arising out of transactions in futures or EOD MTM on day T is settled open currency trading account india the immediate next trading day. This further means that if you have a debit obligation on day Tthe payment will have to be made on day T itself.
Final Settlement Obligations at Bank: How can I unmark the lien and release open currency trading account india amount? The unmark requests placed before 5 PM, would be unmarked during the same day, after the market hours. The requests placed after 5 PM would be processed only at the end of next open currency trading account india trading hours. Therefore the client is expected not to use the amount, for which the unmark request was made, till the lien is released.
In case the client uses this amount on the next trading day, the unmark request would be rejected. Similar to the case of lien marking, when an unmark lien is undertaken; no entry would be passed in the account of the client. Only the lien amount would be reduced by the unmarked amount. All the customers would be initially assigned to one of the slab on the basis of the expected volume from the customer at the time of opening the account.
The actual performance of the customer would be verified against the category volumes at regular intervals and the brokerage category would be modified accordingly. Applicable taxes would be charged to the customer. The above rates can be changed anytime at the discretion of the Bank. The client has to bear the applicable charges for stamping the Member-Client Agreement.
Account opening charges and annual maintenance charges are waived for the first year.