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EXCHANGE TLC
TRADE VALIDATION CHECK TRADE, TRADER, CLIENT/COUNTER PARTY FOR THE TRADE
TRADE CHECK - MO SYSTEM VS. RMS SYSTEM
TRADER CHECK - CHECKING IF THE TRADER HAS CROSSED THEIR LIMITS FOR THE DAY OR
CLIENT CHECK - YOU ARE GOING TO CHECK IF THERE IS ANY NEGATIVE NEWS REGARDIN
HOMEWORK:
TRADE LIFE CYCLE
EQUITY 5
FUTURES 5
OPTIONS - LC/SC LP/SP 3
SUNDAY 6.00 PM
WILL CALL/EMAIL/BLOOMBER CHAT ETC. CONTACT JPM-M TO PLACE AN ORDER
WILL PLACE THE ORDER ON THE EXCHANGE (NSE) - PRICE FIRST & THEN QTY
MGT. SYSTEM
ECONOMIC DETAILS
MISSION FOR THIS TRADE QTY PRICE GROSS VALCOMMISSION
CTIONS TO THE TRADE 15,000.00 2,395.1526 ### ###
BPS - BASIS POINTS 30 BPS
1% - 100 BPS
0.25% - 25 BPS
ED THEIR LIMITS FOR THE DAY OR NOT
ANY NEGATIVE NEWS REGARDING THE CLIENT
ROM FRONT OFFICE TO ENSURE THAT THE DETAILS ARE CORRECT IN M.O,
ALPHA - CLIENT
TRADE INTIATION
TRADE EXECUTION
TRADE CAPTURE
TRADE ENRICHMENT
TRADE VALIDATION
TRADE VERIFICATION
TRADE CONFIRMATION
TRADE SETTLEMENT
RECONCILIATION
NON-ECONOMIC DETAILS (SSI's)
BANK A/C NO.
CUSTODIAN A/C NO.
NTERIES (EXTERNAL)
ECONOMIC DETAILS
TRADE DATE SETTLEMENT DATE DIRECTION QTY PRICE
3/23/2022 3/25/2022 BUY 15,000.00 2,395.15
T+1
T+2
MONEY- GROSS VALUE
SHRS.
THE CH WILL BUY THE 4,000 SHRS AND TRANSFER THAT TO THE BUYER
AND THE COSTS ASSOCIATED WITH THE PURCHASE OF THE 4000 SHR + PENALTY WILL BE TRANSFREED TO THE SELLER WHO D
EXCHANGE SETTLEMENTS
1. CLEARING HOUSE SETTLEMENT
2. BROKER SETTLEMENT THE BROKER WILL BE LEGALLY OBLIGATED TO SETTLE THE TRADE WITH THE CLEARING HOUSE
BUY TRADE - BROKER WILL PAY FOR THE SHARES, ONCE RECEIVED INTO BROKERS DEPOSITOR
BROKER WILL FOLLOW UP WITH THE CLIENT AND ASK THEM TO PAY FOR THE SHARES
ONCE THE CLIENT PAYS FOR THE SHARES THEN ONLY THE BROKER WILL TRANSFER THE SHRS
SELL TRADE - BROKER WILL TALK TO THE CLIENT TO ENSURE THAT THE SHARES ARE IN PLACE
AND CUSTODIAN WILL RELEASE THE SHARES TO THE DEPOSTIORY
CASH WILL BE DIRECTLY CREDITED TO THE CLIENT'S CUSTODIAN
TRADE DATE
ADE EXECUTION TRADE EXECUTION TRADE INTIIATION
NSE
STOCK EXCHNAGE INVESTMENT BANK BETA FUND - INST. INVESTOR
B - 15K - EM @ 3915.00 GS - MUMBAI UK
NSE - WITH MATCH THE BUYER BROKER SELL - 15,000 SHRS. EICHER M
WITH A SELLER
PRICE, QTY, TIME
T+1
RING HOUSE
T+2
MONEY
SELL SIDE SETTLES FIRST
NSCCL
CLEARING HOUSE
SECURTIES ARE DELIVERED
INVENTORY MGT.
1 BUY ORDER - 15,000 15,000 SHRS OF EICHER
1 SELL ORDER - 15,000 WILL BE GIVEN TO
DEPOSITORY - NSDL
CASH IS PAID SHRS. NSDL - WILL REMOVE BETA F
NOVATION
NORMAL MARKET
FREED TO THE SELLER WHO DID NOT DELIVER THE 4,000 SHRS
CUSTODIAN A/C
SCB MUMBAI
INVETORY CHECK
15,000 SHRS OF EICHER IS THERE OR NOT
OTC - DERIVATIVES
OTC - DERIVATIVES - RETIAL INVESORS ARE NOT ALLOWED TO TRADE!
INST. INVESTORS, INV. BANKS, PF, HF, HNI'S ETC - ALL THE "INVESTORS"
THEY NEED TO BECOME A MEMBER OF AN ORGANISATION CALLED
INTERNATIONAL SWAPS AND DERIVATIVES ASSOCIATION (ISDA)
1985 - THE IB COMMUNITY CAME TOGETHER - WE LOVE TRADING AND TRANSACTING IN THE OTC MARKET BUT THERE TO
ISDA - CUSTOMISE THE TRADES ANYWAY YOU WANT HOWEVER, IN TIME OF SETTLMENT WE WILL STANDARDISE IT.
www.isda.org
MIDDLE OFFICE
TRADE ENRICHMENT ADDING ECONOMIC & NON-ECONOMIC DETAILS TO THE TRADE
TRADE VALIDATION CHECK TRADE, TRADER, CLIENT/COUNTERPARTY CHECK (MEMBERS OF ISDA OR
TRADE VERIFICATION COMPARE WITH TRADE SHEET/TERM SHEET
AFFIRMATION SEND OUT THE ECONOMIC DETAILS TO THE CLIENT VIA EMAIL/ELECTRONIC PLA
CORE OPERATIONS
TRADE CONFIRMATION DRAFT THE ISDA AGREEMENT (2-10 DAYS) AND SEND IT TO THE CLIENT FOR SI
TRADE SETTLEMENT EXCHANGE OF SECS. VS CASH
RECONCILIATION COMPARE THE LEDGER WITH THE STATEMENT
SALES
TRADE INTIATION
TRADE EXECUTION
TRADE CAPTURE
MIDDLE OFFICE
TRADE ENRICHMENT TRADE DATE
TRADE VALIDATION
TRADE VERIFICATION
AFFIRMATION
CORE OPERATIONS
TRADE CONFIRMATION 2 - 10 DAYS
TRADE SETTLEMENT AS PER THE CONTRACT
RECONCILIATION THE NEXT DAY AFTER SETTLEMENT
TC MARKET BUT THERE TOO MANY ISSUES WITH DEFAULTS, SETTLMENT RISK, COLLATERAL RISK ETC.
LL STANDARDISE IT.
10 MONTHS CONTRACT
CK (MEMBERS OF ISDA OR NOT)
IA EMAIL/ELECTRONIC PLATFORM - AFFIRM THE TRADE EICHER MOTORS - 100,000 SHRS AT RS. 3915.00
DIRECTION - BUY, PHYISCAL SETTLMENT, 10 MONTHS CO
5 DAYS TO CREATE THIS CONTRACT
D IT TO THE CLIENT FOR SINGATURE/LEGALIZING THE CONTRACT
RS AT RS. 3915.00
TTLMENT, 10 MONTHS CONTRACT
TRADE D
TRADE INTIIATION TRADE EXECUTION
CUSTODIAN A/C
SETTLEMEN
WHAT IF THERE IS A SHORTAGE OF SHRS IN THE MARKET?
THE CLEARING HOUSE WILL DELIVER - WHAT THEY CURRENTLY HAVE
11,000 SHRS OF EICHER MOTORS
THE CH WILL BUY THE 4,000 SHRS AND TRANSFER THAT TO THE BUYER
AND THE COSTS ASSOCIATED WITH THE PURCHASE OF THE 4000 SHR + PENALTY WILL BE TRANSFREED TO THE SELLER WHO D
EXCHANGE SETTLEMENTS
1. CLEARING HOUSE SETTLEMENT
2. BROKER SETTLEMENT THE BROKER WILL BE LEGALLY OBLIGATED TO SETTLE THE TRADE WITH THE CLEARING HOUSE
BUY TRADE - BROKER WILL PAY FOR THE SHARES, ONCE RECEIVED INTO BROKERS DEPOSITOR
BROKER WILL FOLLOW UP WITH THE CLIENT AND ASK THEM TO PAY FOR THE SHARES
ONCE THE CLIENT PAYS FOR THE SHARES THEN ONLY THE BROKER WILL TRANSFER THE SHRS
SELL TRADE - BROKER WILL TALK TO THE CLIENT TO ENSURE THAT THE SHARES ARE IN PLACE
AND CUSTODIAN WILL RELEASE THE SHARES TO THE DEPOSTIORY
CASH WILL BE DIRECTLY CREDITED TO THE CLIENT'S CUSTODIAN
TRADE DATE
SETTLEMENT DATE
NORMAL MARKET
FREED TO THE SELLER WHO DID NOT DELIVER THE 4,000 SHRS
HOMEWORK
OTC TLC - 5 EXAMPLES
MONDAY - 6.00 PM