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Policies

Policies and Procedures forms integral part of the Member Constituent Agreement:

Refusal of order for Penny Stocks:

GSV shall have the absolute discretion to accept, refuse or partially accept any buy or sell order for execution from a client in respect of penny stocks, illiquid stocks, stocks having low liquidity, illiquid options, far month options, writing of options and any other contracts / shares which are extremely volatile or subject to Market manipulation.GSV may permit restrictive acceptance of orders in such scrips / contracts in controlled environments like orders received from clients being forwarded by branches / sub brokers to HO instead of allowing them at branch / sub broker level. GSV may cancel orders in such scrips received from clients before execution or after partial execution without assigning any reasons there of GSV may take appropriate declarations from the clients before accepting such orders. GSV shall not be responsible for delay in execution of such orders and any opportunity / financial loss to the client.

Setting up Client's Exposure Limits:

GSV may have its own policy to allow differential purchase limits and sell limits varying from client to client, depending upon credit worthiness, integrity and past trading record of each client and volatility in the market which may vary from time to time. GSV may provide an exposure limit for intra day and delivery to a client which would be a multiple of the clear ledger balance in the account of the client along with collateral values after appropriate haircut. The value of multiple and haircut shall be decided as per Market volatility, quality of collaterals, credit worthiness, integrity and past trading record of each client which may vary from client to client and from time to time.GSV may provide a sell Iimit to the client equivalent to the value of securities held by the client in his POA enabled Demat account with our CDSL DP and the collaterals held with us in our Beneficiary / Margin account on behalf of clients after making appropriate adjustments for the unsettled delivery positions of the client.GSV may provide Exposure for Futures and Options writing in Derivatives segment based on availability of Initial Margin (Span+ Exposure + MTM) in the form of clear ledger balance. Considering collaterals after appropriate haircut is at the sole discretion of GSV. However the buying of Options in Derivatives segment may be allowed on the premium value against the clear ledger balance available in Client's account.

Applicable Brokerage rates:

Brokerage shall be applied as per the rates agreed upon with the client in the KYC at the time of registration of the client subsequently through a written agreement between the client and GSV. The rate of Brokerage shall not exceed the maximum brokerage permissible under Exchange bye laws. The slab rates of brokerage fixed by us are function of the quality and cost of services provided to the client and the volume and revenue expected from an account. It shall be reviewed by us from time to time and may be increased with prospective effect with prior a notice sent to the email address or postal address of the client registered with us. The Brokerage shall however be exclusive of DP Charges, Account opening charges, delayed payment charges, penalties levied by Exchanges, courier charges, bank charges towards cheque bounces and SEBI/ Exchange / CM turnover or any other charges levied by regulatory and statutory bodies from time to time.

Imposition of penalty / delayed payment charges by either party, specifying the rate and the period(This must not result in funding by the broker in contravention of the applicable laws) :

As per the Exchange bye laws, the Member has to make pay in of funds to the Exchange by T+2 morning and arrange delivery of securities to the Exchange latest by T+2 morning. Further Member broker is also required to maintain adequate upfront margins with the exchange to avail exposure for trading. The exchanges have also defined the ratios in which the cash and collaterals are to be maintained by the Member broker. In order to manage its operations, GSV requires full cooperation of the clients in meeting their respective obligation towards pay in and margins. Mandatory document dealing with Policies and Procedures pursuant to SEBI's Circular MIRSD/SE/Cir” 19/2009 dated 03rd December 2009 GSV is therefore authorized by the client to charge a delayed payment penalty not exceeding 0.10% Per day on account of delays / failure by the client in meeting the pay in obligations on the scheduled date in both Cash & F&O Segment. While levying delayed payment charges in the running account of a client, GSV may not consider any credit balance in the other family or group accounts of the client. Penalties levied by the Exchanges: Further Exchanges levy various penalties on the member brokers on auction resulting from short deliveries, non adherence to client wise exposure limits, client wise shortfalls in F & O Margin and for other reasons which may be defined by the Exchanges from time to time. GSV is therefore authorized by the client to pass on any penalty imposed by the Exchange/SEBI and or any other regulatory authority to the client, which arises on account of the client. GSV provide exposure against the upfront margins received in the form of cash / collateral from the client and the client also has the right to withdraw Cash and collaterals at his/ her discretion, GSV shall not pay any interest other benefit to the client for maintaining cash balances or depositing collateral margins.

The right to sell client's securities or close client's positions without giving notice to the client,on account of non payment of client's dues (This shall be limited to the extent of settlement /margin obligations):

GSV is having the right to sell client'ss securities, both unpaid securities as well as collaterals deposited towards margins, or close out client's open positions, without giving notice to the client where there is a delay / failure of the client to meet the pay in obligations and / or there is a failure of the client to bring additional margins to cover the increase in risk in the dynamic market conditions. In case of unpaid obligations on T+3 basis, GSV may sell the unpaid / partially paid securities. In addition GSV may sell the collaterals deposited by the client towards margins and or paid securities purchased by the client in earlier settlements where the sale proceeds of unpaid securities are inadequate to cover the pay in obligations and where the unpaid securities appear to be comparatively illiquid and cannot be sold at reasonable rates to the extent required. GSV may follow LIFO method for liquidation of securities but it may not binding on it to follow this method in all cases. Margin shortfalls in F & O: Positions of the client may be closed out to the extent of margin shortfall on the T+1 basis. While computing margin shortfall value of unapproved securities shall not be considered. GSV reserves the right to consider the collateral. Intra day Positions: GSV shall have right to close out any intra-day positions taken by the client after a defined Cut off time (Presently 15 minutes before close of market).While selling the securities / closing the client's positions, GSV may take into account the sales made by the client, positions closed by the client or collections received from the client till a cut off time. While selling the securities / closing the client's positions, GSV may not take into consideration cheques / drafts/ pay orders deposited by the client with it until clear proceeds of such instruments are received by it in its bank account. GSV shall have the right to sell client's securities or close out client's open positions but it shall not be under any obligations to undertake this exercise compulsorily. GSV shall therefore not be under any obligation to compensate / or to provide reasons of any delay or omission on its part to sell client's securities or close open positions of the client. The ultimate responsibility risk and liability of the trades are binding on the client.

Shortages in obligations arising out internal netting of trades:

GSV shall have the right to adopt a policy of its choice for internal auctions arising out of internal netting of trades and charge to defaulter seller and compensate the impacted purchaser as per the policy.

Conditions under which a client may not be allowed to take further position or the broker may close the existing position of a client:

Where the client is not having adequate margins as per conditions defined in Risk Management Policy. In Cash Segment : Where the client has not able to meet his pay in obligation in cash by the schedule date of pay in, irrespective of the value of collaterals available with GSV. Clear proceeds of the cheque deposited by the client to meet the pay in obligations has not yet been received by GSV.Client is trading in illiquid securities and volumes in his account exceed internal cut off limit fixed by GSV. GSV exposure at house level in a specific scrip / contract exceeds the internal limits fixed by it.In Derivatives: Where the client has not met the margin and has not met Market to Market loss in cash. Where the open positions in a contract exceeded or are close to market wide cut off limits. Where the client's position is close to client wise permissible open positions. Intraday: Clients may not be able to place intra day orders after a cut off time fixed by us. (Presently 15 minutes prior to close of market)

Temporarily suspending or closing a client's account at the client's request:

GSV may carry a periodic review of the client accounts and may suspend the accounts from trading in the following circumstances:

  • Where the client is inactive for more than 6 months.

  • Where the client account is under investigation by any regulatory body.

  • Where the client has not cleared the naked or uncovered debits which are more than 7 days old.

  • Non-delivery of statement of accounts sent on period basis.

  • Physical contract notes are received back undelivered due to reasons like “No such person, addressee left, refusal to accept, or other reasons which create suspicion.

  • DCN failed (Bounced email) on more than 3 instances until client submits and registers new email id.

  • Non-updation of communication details like email id, mobile number, land lines details or if it is found to be belonging to the third person.

  • On notices received from Statutory, government or local authorities and Income Tax, Service Tax authority etc.

  • Where a client is reported to or known to have expired.

  • Any other reason at the discretion of GSV.

  • Written request from the client for suspension.

Deregistering a Client: GSV may deregister a client on the following circumstances:

Any action taken by SEBI / NSE / BSE or being part of list of debarred entities published by SEBI.

  • On basis of information found in sites of CIBIL, Watch out Investors, or client having suspicious back ground, link with suspicious organization etc.

  • GSV shall have right to close out the existing positions; sell the collaterals to recover its dues, if any, before de registering the client.

  • GSV shall have the right to deregister a client after serving a 15 days written notice without assigning any reason thereof.

    • I / we have clearly understood and agree to abide by aforesaid policies and procedures.

    • I /we also understand and agree that these policies and procedures can be changed from time to time.

    • I /we understand that GSV shall have the right to implement all the above policies but shall not be under any obligations to undertake this exercise compulsorily. The ultimate responsibility, risk and Iiability of the trades are binding on the client

Policy on Hiring and Training

Hiring of Employees GSV is having adequate screening procedures in place to ensure standards when hiring employees. They should identify the key positions within their own organization structures having regard to the risk of money laundering and terrorist financing and the size of their business and ensure the employees taking up such key positions are suitable and competent to perform their duties. Employee's Training GSV is having an ongoing employee training programme so that the members of the staff are adequately trained in AML and CFT procedures. Training requirements being focused for frontline staff, back office staff, compliance staff, risk management staff and staff dealing with new customers. GSV staff is much concerned that understanding the motivation behind these guidelines, obligations and requirements, implements them consistently and are sensitive to the risks of their systems being misused by ruthless elements.

Shortages in obligations arising out internal netting of trades:

GSV shall have the right to adopt a policy of its choice for internal auctions arising out of internal netting of trades and charge to defaulter seller and compensate the impacted purchaser as per the policy.

Policy for inactive clients

Client account will be considered as inactive, if the client does not trade for period of Six months. Calculation will be done at the beginning of every month and those clients Who have not traded even a single time will be considered as inactive. G.S.V. SECURITIES Private Limited would be placing such accounts under temporary suspension. Once the account is under temporary suspension, the client would not be allowed to login to his account or trade (place orders) either through online mode or by calling/visiting its service branch. For an inactive client to become active the client should provide proof of identity and bank statement and a letter stating to start trading.

Policy in Anti Money Laundering

GSV's intentions for publishing a policy on Prevention of Anti Money Laundering Act is not to impose restrictions that are contrary to GSV's established culture of openness, trust-worthy and integrity. GSV is strictly following Rules/Regulations/Bye-Laws to maintain the compliance of Regularity Authorities/SEBI and Exchanges to facilitate a Trading platform to transact with more transparency and to maintain a good business relationship with Clients, Individual Investors and Business associates. We are providing Exchanges connectivity via VSAT and Internet to access the Market Watch of different Exchanges and Segments. Trader Work Stations are being installed to place their Buy/Sell orders, Price Enquiry, Confirmations, Outstanding Position, Net Positions, Funds and Securities. Effective service and monitoring is a team effort involving the participation and support of every GSV employee and affiliate who deals with information and/or information systems. It is the responsibility of every employee to know these guidelines, and to conduct their activities accordingly.

The purpose of this policy is to outline the business operations and not to deviate from the procedures being followed at GSV. These procedures are in place to protect the Clients, Investors and GSV. Inappropriate application of these procedures exposes GSV to risks including disablement by SEBI/Exchange, Loosing Market Good will, Financial Loss and legal issues.

Scope of the policy

GSV have been maintaining the margin system to protect the client from the risk and unexpected losses. This is purely based on the market conditions and the client's history of maintaining the account with us. GSV does not allow any client/sub-broker to transact in any Exchange/Segments without margin either in cash or collateral. According to margin availability, we consider the intra-day exposure limits. And these exposure limits are not fixed and will vary based on the market conditions/volatility. In case of Derivative segment, margin has to be maintained as per the Exchange specifications. GSV has sending a consolidated margin report on EOD basis to all clients/sub-brokers to know the outstanding position to prepare for the next trading session. This report has been prescribed by the Exchange to inform all clients regularly. The soft copy is being maintained for intra-day margins calls for any future reference

GSV should ensure that an account is not opened where it is unable to apply appropriate clients due diligence measures/KYC polices. This may be applicable in cases where it is not possible to ascertain the identity of the client, information provided to the GSV is suspected to be non genuine, perceived non co-operation of the client in providing full and complete information. GSV should not allow such client and file a suspicious activity report to determine any suspicious trading. In such cases the account must be free zed or closed. GSV is more cautious to ensure that it does not return securities of money that may be from suspicious trades. However, GSV should consult the relevant authorities in determining what action it should take when it suspects suspicious trading. In case, the client is permitted to act on behalf of another person, the extent of account operation must be keep tracking of transactions, volume limits, exposure limits and the value of transaction exceeding from the actual eligibility/allocation. The role and responsibilities of both the persons must be verified to avoid illegal/malicious trading activities. The relationship of the client has to be screened and ensure that the identity of the client does not have any links with person having a criminal background

Policy on Pre-funded Instruments

As a Policy GSV. Securities Pvt. Ltd. discourages receipt of funds from the Clients through Prefunded Instrument means Demand Draft, Pay Orders, Fund Transfer through Internet, etc This is to discourage the flow of third party funds or unidentified money into the System to avoid future litigations and comply with the Regulations of the regulatory bodies. The Prefunded Instruments may be accepted under special circumstances with the permission of the Senior Management / Board of Directors. The special circumstances include:

  • Continuous Bank Holidays.

  • Client having account in other Banks or in Co-operative bank

  • To Meet Immediate Margin/Settlement Shortfall

  • To take Fresh Position

  • Client‘s bank or City do not have clearing facility / branch.

  • Non Availability Cheque book or delay in procuring cheque book

  • Default Client Where the aggregate value of the prefunded instrument is less than Rs. 50000/- per day per client, the prefunded instrument is accepted only after ascertaining the genuine reason for the said prefunded instrument and after obtaining undertaking to that affect by maintaining the Xerox copy of the prefunded instrument. Where the aggregate value of the prefunded instrument is Rs. 50000/- or above per day per client, the prefunded instrument is accepted only after ascertaining the genuine reason for the said prefunded instrument and after obtaining undertaking to that affect and accompanied by the name of the account holder and number of the bank account debited for the purpose duly certified by the issued bank. The mode of the certification may include the following:

    • Certificate from the issuing bank on its letterhead or on a plain paper with the seal of the issuing bank.

    • Certified copy of the requisition slip (portion which is retained by the bank) to issue the instrument.

    • Certified copy of the passbook/bank statement for the account debited to issue the instrument.

    • Authentication of the bank account-number debited and name of the account holder by the issuing bank on the reverse of the instrument. The Prefunded Instruments will be accepted only in cases mentioned above and not otherwise. The credit of such prefunded instruments will be given to the Clients only on the fulfillment of the above procedure and subject to the approval of the Senior Management / Board of Directors.

Policy on Risk Management

GSV's intentions for publishing a Risk Management Policy are not to impose restrictions that are contrary to GSV's established culture of openness, trust-worthy and integrity. GSV is strictly following Rules/Regulations/ByeLaws of SEBI and Exchanges to facilitate a Trading platform to transact with more transparency and to maintain a good business relationship with Clients, Individual Investors and Business associates. We are providing Exchanges connectivity via VSAT and Internet to access the Market Watch of different Exchanges and Segments. Trader Work Stations are being installed to place their Buy/Sell orders, Price Enquiry, Confirmations, Outstanding Position, Net Positions, Funds and Securities. Effective service and monitoring is a team effort involving the participation and support of every GSV employee and affiliate who deals with information and/or information systems. It is the responsibility of every employee to know these guidelines, and to conduct their activities accordingly. The purpose of this policy is to outline the business operations and not to deviate from the procedures being followed at GSV. These procedures are in place to protect the Clients, Investors and GSV. Inappropriate application of these procedures exposes GSV to risks including disablement by SEBI/Exchange, Loosing Market Good will, Financial Loss and legal issues. This policy applies to employees, Clients, Investors, Sub-brokers, and other Business associates at GSV. This policy also applies to all business activities those are performed through GSV. As per the Exchange settlement cycle, we have to collect the pay-in either funds or securities within T+1. If the client is unable to complete the pay-in obligation with in T+2, he/she will not be allowed for fresh buying. 29 Cycle of Pay-in Capital Market Segment T+1 collect from clients T+2 Morning Completing the Exchange obligation T+3 Releasing of payout of funds and securities Future and Options Segment T+1 collection for client T+1 Morning completing the Exchange Obligation T+1 Evening Pay-out from Exchange T+2 Releasing of Payout to clients .We have been maintaining the margin system to protect the client/sub-broker from the risk and unexpected losses. This is purely based on the market conditions and the client's history of maintaining the account with us. GSV does not allow any client/sub-broker to transact in any Exchange/Segments without margin either in cash or collateral. According to margin availability, we consider the intra-day exposure limits. And these exposure limits are not fixed and will vary based on the market conditions/volatility. In case of Derivative segment, margin has to be maintained as per the Exchange specifications. GSV has sending a consolidated margin report on EOD basis to all clients/sub-brokers to know the outstanding position to prepare for the next trading session. This report has been prescribed by the Exchange to inform all clients regularly. The soft copy is being maintained for intra-day margins calls for any future reference. GSV is not encouraging the cash transaction while processing the payment and receipts. We accept payment only through Check/DD/Online Transfer. In case of payment through Demand Draft, the payee has to declare the details of the Demand Draft in his covering letter. Do not accept any third-party cheques under any circumstances. This will help us to avoid unrealized/unauthorized dealing of funds. Squaring-off position is being done only in case of unrealized margin outstanding, minimizing the further losses and any unforeseen market conditions. Before squaring-off 30 any position, we always seek the final opinion from the owner of the transaction in multiple intervals. In the event of unanswered, irresponsible, intimating/sending messages in multiple intervals and considering the duration of live market session, if the owner of the transaction does not respond in time, the Management/RMS will be the final decision maker to Square-off the position immediately and the same will be intimated to the ultimate client through concerned Branch Manager/Sub-broker. The value of margin before squaring-off any qty should meet 100%. In other instances up to 75% is also considered based on the client's previous history of transactions. GSV is having a robust mechanism of internal controls on Risk Management to safeguard the Clients and Business associates. All tracking, filtering, alarming mechanism is in place to avoid malpractice, suspicious and other unauthorized entries through our system. The level of hierarchy is being maintained to manage the risk parameters.

Policy on Surveillance

GSV is having a robust mechanism of internal controls on Risk Management to safeguard the Clients and Business associates. All tracking, filtering, alarming mechanism is in place to avoid malpractice, suspicious and other unauthorized entries through our system. The level of hierarchy is being maintained to manage the risk parameters.

  • Corporate ID — Exchange Connectivity

  • Connect2NSE — Exchange Connectivity

  • CTCL Surveillance Administration- CTCL vendor Software

  • Risk Monitoring

  • Access of online Back-office

  • On hand Surveillance reports MIS reports

Internal Policy in respect of passing of NISM-Series –VII: Securities Operation and Risk Management Certification Examination

Reference

  • SEBI Notification No.LAD-NRO/GN/2010–11/21/29390 published in the Gazette of India on December 10, 2010

  • NSE Circular no. NSE/INSP/16536 December 15, 2010

  • NSE Circular no. NSE/INSP/27495 September 02, 2014

  • BSE Notice no.20101215–19 dated December 15,2010

  • BSE Notice no. 20140902–8 dated September 02,2014

Brief

SEBI issued Notification no. LAD-NRO/GN/2010–11/21/29390 dated December 10, 2010 , according to which, following categories of associated persons associated with a registered stock broker/trading member/clearing member in any recognized stock exchanges, who are involved in, or deal with any of the following:

Assets or Funds of investors or clients

  • Redressal of investor grievances

  • Internal control or risk management

  • Activities having a bearing on operational risk

shall be required to have a valid certificate of NISM Series VII – Securities Operation & Risk Management (SORM) from National Institute of Securities Market(NISM). NSE and BSE has also issued circulars requesting the members to comply with the requirement of said SEBI Notification.

Need For the Policy

The Company being a trading member NSE /BSE , provisions of the aforesaid requirement is applicable to all its employees involved in the activities as mentioned above.

Policy

As required in the aforesaid notification of SEBI, all existing persons associated with the Company as on date of publication and engaged in deal with:

  • Assets of funds of investors or clients

  • Redressal of investor grievances

    © Internal control or risk management

  • Activities having a bearing on operational risk

shall obtain the valid certification of NISM Series VII — Securities Operation and Risk, Management (SORM) within two years from the date of such notification. Simultaneously whenever the company employs any associated person specified as mentioned above, the said associated person shall obtain valid certification of NISM Series VII – Securities Operation and Risk Management (SORM) within one year from the date of his /her employment/registration as sub-broker.

However, any of the works (as stated herein above) being performed by such persons, obtaining, NISM-SORM Certification shall be optional provided that they are supervised by his / her supervisor who shall have to obtain / continue to have NISM – SORM Certification or such other prescribed certification at all times.

Squaring Off Client Positions

GSV is having the right to sell client's securities, both unpaid securities as well as collaterals deposited towards margins, or close out client's open positions, without giving notice to the client where there is a delay / failure of the client to meet the pay in obligations and / or there is a failure of the client to bring additional margins to cover the increase in risk in the dynamic market conditions. In case of unpaid obligations on T+3 basis, GSV may sell the unpaid / partially paid securities. In addition GSV may sell the collaterals deposited by the client towards margins and or paid securities purchased by the client in earlier settlements where the sale proceeds of unpaid securities are inadequate to cover the pay in obligations and where the unpaid securities appear to be comparatively illiquid and cannot be sold at reasonable rates to the extent required. GSV may follow LIFO method for liquidation of securities but it may not binding on it to follow this method in all cases. Margin shortfalls in F & O: Positions of the client may be closed out to the extent of margin shortfall on the T+1 basis. While computing margin shortfall value of unapproved securities shall not be considered. GSV reserves the right to consider the collateral. Intra day Positions: GSV shall have right to close out any intra-day positions taken by the client after a defined Cut off time (Presently 15 minutes before close of market).While selling the securities / closing the client's positions, GSV may take into account the sales made by the client, positions closed by the client or collections received from the client till a cut off time. While selling the securities / closing the client's positions, GSV may not take into consideration cheques / drafts/ pay orders deposited by the client with it until clear proceeds of such instruments are received by it in its bank account. GSV shall have the right to sell client's securities or close out client's open positions but it shall not be under any obligations to undertake this exercise compulsorily. GSV shall therefore not be under any obligation to compensate / or to provide reasons of any delay or omission on its part to sell client's securities or close open positions of the client. The ultimate responsibility risk and liability of the trades are binding on the client.

Investor Alert:
Prevent Unauthorised transactions in your account. Update your mobile numbers/email IDs with your stock brokers. Receive information of your transactions directly from Exchange on your mobile/email at the end of the day.......... Issued in the interest of investors.

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Registered Office Address: D.NO: 54-28/3-5, Plot NO: 42,Opp Gurudhvara Behind OBC Bank, Gurunanak Colony Vijayawada Krishna AP 520008 IN

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