RISK MANAGEMENT POLICY

The following document describes the risk management policy followed by Prudent Corporate Advisory Services Limited (herewith refer as PCAS). Please read it carefully as it pertains to your trading activity.

Definitions
  1. RMS (Risk Management System) - This helps PCAS manage the risk of the company and client from the volatility of the market.
  2. Cash - This is the clear balance available in the customer’s ledger account in our books.
  3. Margin - The underlying stake provided by the customer in the form of Cash.
  4. Exposure - The aggregate of the customer’s obligations arising out of buy and sell trades awaiting settlement in the cash segment and profit/ loss amounts that are yet to be settled on the closed positions.
  5. Exposure multiplier - The number of times that exposure is allowed on the underlying margin on the cash segment under Intraday would have to be made either on the availability of cash margin or on the availability of the stocks (which has been sold subject to adjustment of margin requirement) in our margin account.

Policy Statement

  1. Setting up exposure limits
    We provide an exposure limit to a client which would be a multiple of the clear ledger balance in the account of the client only in NIFTY top 200 scripts which form part of F&O segment. The value of the “multiple” will be Three times or actual margin required by exchange (VAR+ELM) whichever is higher which may be changed by RMS Team from time to time based on market conditions. Clients can place orders in two products: -
    • Intraday
    • Delivery
    If a client wishes to use margin, he/she can place orders with the Intraday product. Once the trade has been filled, only a portion of the full applicable margin will be blocked as per margin requirements for the stock. PCAS will square off all open positions under the Intraday Product anytime during the last 30 minutes of normal market closure timing. If a client wishes to hold a stock overnight, he/she can place orders using the CNC product code. The full amount of margin is applicable at the time of placing the order.
  2. Policy for penny stocks
    Stocks which appear in the list of illiquid securities issued by the Exchanges every Quarter are considered penny stocks. These stocks are generally considered to be highly speculative and risky because of their lack of liquidity, large bid-ask spreads, small capitalization and limited following and disclosure. Depending on the market condition and RMS policy of the company, PCAS reserves the right to refuse to allow trading and/or provide limits on penny stocks.
  3. Delivery Trades
    The net purchase or sale of scrip in a client account that is settled by way of a delivery on T+2 (or as per settlement schedule). Delivery in respect of sale transactions in the cash segment must be settled by the client by tendering securities either through e-dis/POA mode. By not doing so, the client faces the risk of entering in auction.
  4. Sell against buying stocks
    Clients are cautioned to wait until stocks they have purchased have been delivered before selling them. In case he buys a stock and sells it a day later, the two transactions won’t net each other out since delivery occurs after T+2 days. The second transaction would be considered a short pay-out of security and PCAS will not be responsible for any short pay-outs.
  5. Trading in newly listed shares, illiquid securities
    Newly listed securities, illiquid securities and Trade-to-Trade securities which have high VaR margin are subject to high market risks and rate fluctuations. Illiquid securities and Trade-to-Trade securities will have a daily price range (DPR) whereby the chances that these shares can reach the upper DPR or Lower DPR during a trading day are higher than other securities. Hence, the dealing in these securities will be subject to permission from the surveillance department and will be subject to the available credit balance.
  6. Policy for ASM and GSM Securities
    In case of ASM and GSM securities the Company would Block trades in scrips that fall under ASM/GSM category from grade I/ Stage I itself. Exchanges has vide their respective circulars have provided for guidelines on ASM and GSM securities. The client can refer to the same in case of explanation required.
  7. Intraday Margin Exceptions
    Intraday Margin may be reduced on certain days due to any of the following reasons:
    • Exchange policy changes or regulation
    • Government policy changes or regulation
    • Broker policy changes
    • Excessive or abnormal market movement / turnover / volatility
  8. Benefits of Early Pay in of Stock Sell on T Day
    If the client do the early payin of the securities sold on T day, he/she can use 80% of the sell proceeding against further trade.
  9. Risk Management (Online Surveillance)
    PCAS utilizes a margin based automated RMS. Total deposits of the clients are uploaded in the system and the client may take exposure on the basis of margin applicable for the respective security as per the VaR based margining system of the stock exchange and / or margin defined by the RMS team based on their risk perception.
  10. Mark-to-Market Square-OFF
    At any given point in time if the MTM level of the client breaches 80% of his available Cash margin, the risk team would square off the complete positions of the client with or without intimating the clients.

    For sake of better understanding, the square off percentage of 80% is basically the threshold base limit and it should not be construed as exact 80%. The position may get squared off at or around 80% of the base threshold limit. In case of extreme market volatility, it may not be possible to monitor the square off limit from percentage (%) to percentage (%).

    Further the square off will also be based on the extreme volatility in the market which may have severe impact on the client and the company. The Company may or may not inform the client on the same in case of such circumstances. (SEBI guideline on close out/square off)

    If the client is having MTM loss of more than 40% but less than 80% of his available cash margins, the square off call will be taken by the Risk team. A prior intimation on the same may or may not be given and thus clients are requested to take care of their positions and MTM.

    There may or may not be a margin calls or intimation from our RMS desk.

    PCAS shall not be liable for any loss that arises due to selling of scrips by the RMS team on non-payment as well as loss in case where selling of scrips has not been carried out by the RMS team as mentioned above due to any reason.

    PCAS reserves the right to change the above policies any time in general or in particular case within the Exchange regulations / SEBI regulations / guidelines.

Prudent Corporate Advisory Services Ltd.
"Prudent House", Panjrapole Cross Road,
Nr. Polytechnic, Ambawadi,
Ahmedabad - 380 015, Gujarat, India.
Compliance Officer:
Mrs. Rima Patel
compliancemf@prudentcorporate.com
(079) 40209600
Social Media

Prudent Corporate Advisory Services Ltd.(PCAS): Member of NSE & BSE – SEBI Registration No as stock broker: INZ000293634. Member ID : - NSE : 90209, BSE : 6733, CDSL – IN-DP- 477-2020 (DP ID: 12090600), CIN - U91120GJ2003PLC042458.

Registered Address: Prudent House, Panjrapole Cross Road, Nr. Polytechnic, Ambawadi, Ahmedabad - 380015, Gujarat, India.

For any complaints pertaining to securities / broking please write a mail to ig@prudentcorporate.com

Please ensure you carefully read the Risk Disclosure Document as prescribed by SEBI

Investor Alert:
  1. KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (Broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary.
  2. Prevent Unauthorized transactions in your Trading / Demat account --> Update your mobile numbers/email IDs with us. Receive information of your transactions directly from Exchange / CDSL on your mobile/email at the end of the day / same day.......... Issued in the interest of investors.
  3. No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in the investor's account.
  4. Investors should be cautious on unsolicited emails and SMS advising to buy, sell or hold securities and trade only on the basis of informed decision. Investors are advised to invest after conducting appropriate analysis of respective companies and not to blindly follow unfounded rumours, tips etc. Further, you are also requested to share your knowledge or evidence of systemic wrongdoing, potential frauds or unethical behaviour through the anonymous portal facility provided on BSE & NSE website.
  5. Filing complaints on SCORES – Easy & quick
    • a. Register on SCORES portal b. Mandatory details for filing complaints on SCORES: Name, PAN, Address, Mobile Number, E-mail ID. c. Benefits: i. Effective communication. ii.Speedy redressal of the grievances.
  6. SEBI COMPLAINTS REDRESS SYSTEM Link :- https://scores.gov.in/scores/Welcome.html
  • Attention Investor:
  • 1. Stock Brokers can accept securities as margin from clients only by way of pledge in the depository system w.e.f. September 1, 2020. 2. Update your mobile number & email Id with your stock broker/depository participant and receive OTP directly from depository on your email id and/or mobile number to create pledge. 3. Pay 20% upfront margin of the transaction value to trade in cash market segment. 4. Investors may please refer to the NSE's Frequently Asked Questions (FAQs) issued vide circular reference NSE/INSP/45191 dated July 31, 2020 and NSE/INSP/45534 dated August 31, 2020 & BSE’s notice no. 20200731-7 dated July 31, 2020 and 20200831-45 dated August 31, 2020 and other guidelines issued from time to time in this regard. 5. Check your Securities /MF/ Bonds in the consolidated account statement issued by NSDL/CDSL every month. .......... Issued in the interest of Investors

Company does not offer any scheme for any assured returns. In case, any such scheme offered by any of employee or other Authorized Person of the company, the same should not be accepted and no investment in such scheme to be made. In case of any such scheme offered by any person, kindly contact compliance team of the company on (+91) (79) 40209600. In case any investment made in such scheme, company will not be responsible for any claims or grievances for any loss on account of relying on the said scheme. 

Advertisement Disclosure - Non-Broking Products/Services e.g. Mutual Fund, Mutual Fund-SIP, Research reports, Insurance, etc "These are not Exchange traded product and the Member is just acting as distributor and all disputes with respect to the distribution activity, would not have access to Exchange investor redressal forum or Arbitration mechanism.”