1. Introduction

The risk management process is a centralised process. The RMS team is alone in charge of monitoring and controlling the risk.

The major steps of the RMS Process flow include the following: (Be aware, however, that client investments are subject to market risk.).

• To list the main risks that the Stock broking industry faces and to outline a plan for managing and mitigating those risks in real time as well as Pre & Post market times.
• To specify a concise and straightforward risk management process for equities and derivatives markets.
• To provide consistency, uniformity, accuracy, and openness in all risk-related activities.
• To ensure improved client satisfaction by facilitating quick TAT.

2. Products

Customers can place orders for Delivery, Intraday (MIS) trades across segments i.e. Cash and Derivatives on Sahi.

In Cash Segment for Delivery or CNC trades, customers are required to have in their ledger balance funds up to the 100% of the gross value of stock at the time of the transaction.

In Cash Segment for Intraday trades, Sahi customers are provided a limit which is as per the exchange defined VAR+ELM for the respective scrips and subject to a minimum of 20%.

For e.g.: customer A has effective ledger balance of Rs. 10,000 and wishes to buy a scrip X, assuming that the VAR+ ELM for the scrip X is 20%, customer can buy/sell scrip X only up to worth Rs. 50,00 for intraday.In terms of MIS/NRML Based derivative trades, the Sahi customer is provided a margin which is as per exchange defined margin that also is equal to Span + Exposure + Delivery + Special Margin.

For Futures and Options traded on NSE/BSE Exchange, the limit provided to the customer is as per margin requirements for the respective contract.

For Example, customer wishes to trade in 1 lot of Nifty, assuming the margin required to create position in 1 lot of Nifty is Rs 2,00,000. The customer needs to have an effective ledger balance of at least Rs 2,00,000 to initiate the trade.

In terms of derivatives contracts there are specific criteria which define the contracts that can be traded via Sahi for both normal and intraday (MIS) trades in order to protect the consumers from market volatility and fluctuations.

The criteria for trading the areas are summarized below in Table 1.

Table 1: Derivative contract allowed for trading:

Considering market conditions, SAHI can block certain strike prices of index / stocks at its discretion to avoid market risk.

The product wise summary for trading limit that is available via Sahi is summarized below in Table 3.

Current leverage and margin under this policy will be shown when you place an order in the Sahi app.

Table 3: Summary of SAHI Product-wise limits:

List of Permissible Intraday Scrips.

Note: *Table 3 above - Maximum limit that can be provided for a scrip.

The list of permissible intraday scrips at Sahi, specifies the scrip-wise margins.

Price Band revisions for selected intraday scrips:

In the event of a Price Band revision by the Exchanges for instance, if the price band for any scrip is reduced from 20% to 10%, we will apply a VAR margin of 100% on the affected scrip from the date of such price band revision or Sahi can disallow scrips from MIS Intraday trading at its discretion.

3. Customer Trading Limit

Trading Limit’s - Available Ledger balance (ALB) is arrived at as follows:

• ALB = (BOD) Settled Ledger balance (+) Unsettled ledger balance of Trade+1day (-) 1.2X Value of undelivered Stock (Short sell) (-) Realised Loss - Unrealized Loss - buy premium value of short option - Margin charged on Derivatives
• Available Balance for Trading = Settled ledger balance + Unsettled ledger balance + Funds Pay in - Realised Loss - Unrealised loss - Funds Payout - Utilised amount - Option buy premium - Option sell premium

Limits and Caps:

1. Single order limit
2. Exposure and Turnover cap at client level
3. Exposure and Turnover cap at underlying level
4. Client wise position limits

4. Restricted Stocks and Contracts

In the cash segment, Illiquid stocks are those that cannot be sold easily due to limited trading volume...

Ban period:

No fresh positions or Rollover of existing positions will be allowed if the security is in ban period. Clients can square off their existing positions only.

5. Margin and Margin Collection

1. Margin is the minimum amount required...
2. This includes all exchange mandated margins...
3. Clients need to give upfront margins...
4. Clients must monitor positions in real time...

6. Risk based Liquidations (Square-Off Policy)

Timer Based Intraday Square-off:

All intraday positions will be squared-off...

7. Physical settlement of F&O Segment

Stock Future and Option contracts will be blocked on Monday...

Current Margin Rule

8. Payout of Funds & Credit for Sale

Payout Process

Requests before 4 PM processed same day...

Credit for Sale (CFS)

100% of sell credit is allowed same day...

9. Delayed payment Charges

Delayed payment charges: 0.045% per day, simple interest, compounded monthly.