INDIA COMMODITY EXCHANGE (Seize the right opportunity)

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COMMODITY QUOTES
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Do’s And Don’ts For Members & Clients

DO’S FOR MEMBERS Registration
  • The Member shall, when establishing relationship with a new client, take reasonable steps to assess the background, genuineness, financial soundness and investment objectives of such client.
  • The Member shall obtain client registration forms from all constituents
  • The Members shall enter into agreement with each of their constituents before accepting or placing orders on their behalf
Contract Notes
  • Members shall issue signed contract notes in the prescribed format to their constituents for trades executed within 24 hours from the close of trading hours when the trade is executed.
  • Members shall keep copies/duplicates of contract notes issued.
  • Contract notes shall be numbered with unique running serial number.
Margin
  • Members shall buy/sell derivatives contracts on behalf of the constituent only on receipt of a margin on the prices of derivatives contracts proposed to be purchased/sold.
  • The minimum margin percentage will be prescribed by the Exchange. Members may collect higher margins from constituents as deemed fit.
  • Members shall obtain a written undertaking from the constituents that they shall, when called upon to do so, provide a margin deposit and/or additional margin money as required in respect of business done for the constituents by the member.
Funds of Clients
  • Members shall at all times keep moneys of constituents in a separate bank account and their own money in a separate account. No payment for transaction in which the member has taken a position, shall be made from the clients’ account.
  • Members shall keep such books of accounts to distinguish moneys received/paid on account of each of their clients and moneys received/paid on their own account.
  • Members shall make full payment of funds to their constituents within 24 hours of receipt of relevant payout from the Exchange.
DON’TS FOR MEMBERS Registration
  • Members shall not become constituents of another member or allow another member to be their constituent.
  • Member shall not deal on or access the Trading System of the Exchange through another member or on behalf of another member without prior approval of the Exchange.
  • Member shall not carry out business or execute any deals for any member, who has been suspended, expelled or declared defaulter by the Exchange.
Funds of Clients
  • No money shall be paid into the client’s account other than money held or received on account of clients; or money which may be required for the purpose of opening or maintaining the account.
  • No money shall be drawn from client’s account other than money required for payment on behalf of clients for or towards payment of a debt due to member from clients.
DO’S FOR CLIENTS Account opening
  • Trade only through registered members of the Exchange.
  • Enter into a Client-Trading Member Agreement with the member.
  • MCo-operate with the member in filling up the Know Your Client (KYC) form
  • Insist on getting a Client-ID.
Pre-Trading
  • Insist on reading and signing the ‘Risk Disclosure Agreement’ before entering into any transactions.
  • Assess the risk-return profile of the investment as well as the liquidity and safety aspects before making and/or acting upon any investment decision.
  • Make investments based on sound reasoning, after taking into account all available information.
  • Understand thoroughly the Delivery and Settlement Procedure as well as taxation and other relevant laws
Trading
  • Obtain receipt from members for collaterals deposited with them towards margins.
  • State clearly who will be placing orders on your behalf. Give precise and clear instructions while placing, modifying or canceling orders.
Post-Trading
  • Cross check the genuineness of trades carried out at the exchange through the trade verification facility available on website.
  • Pay all applicable margins on futures position to the member. Also, collect/ pay mark-to-market margins from/to the member which are required to be settled on a daily basis.
  • Pay required margins on time and only by cheque and ask for receipt thereof from the member. Issue cheques/drafts in your member’s name and receive cheques/drafts in your name.
  • Do not exceed the position limits prescribed periodically by the exchange or Forward Markets Commission.
DON’TS FOR CLIENTS
  • Do not deal with unregistered intermediaries even if their charges are lower and/or margins are lower.
  • Do not start trading before reading and understanding the Risk Disclosure Agreement and entering into the prescribed agreement with the Member.
  • Do not get misled by rumors, luring advertisements, hot tips and promises of unrealistic returns.
  • Do not sign blank Delivery Instruction Slips (DIS), since the same can be misused.

Indian Commodity Exchange Ltd | CIN : U67120GJ2008PLC099142 Corporate Office: Reliable Tech Park, 403-A, B-Wing, 4th Floor, Thane-Belapur Road, Airoli (E), Navi Mumbai – 400708, India. Tel.No:+91-22-40381500 | Fax No:+91–22-40381511 Registered office:1st Floor, Office-109, Nodh No.- 1158 to 63/65/9, Hat Faliyu, Mahidharpura, Surat, Gujarat-395003, India |Tel. No.: +91-261-2609960/3009960
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