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Stockbrokers have up their ante on behalf of their clients to compensate for today's loss from the National Stock Exchange.
According to them, the market regulator is currently working on a framework for bourses and brokers to pay investors for losses due to technical glitches.
“SEBI is actively considering a proposal to introduce a framework for ascertaining the incidents of technical glitches where compensation needs to be paid to the investors and to devise a methodology and calculation of compensation,” SEBI said in its annual report, which was out recently.
The NSE, which was shut down around 1140 am, is yet to resume trading.
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While Twitter was flooded with memes on the glitch, many expressed their concern about possible trading losses"We will be very happy, if NSE compensates," said a founder of a leading broking house. "I don't know how it is manageable because of millions of claims," he said and added "it is high time for the market regulator to come with a clear guideline on this recurring issue very soon".
There are instances where exchanges asked brokerages to compensate their clients on losses due to technical issues at their end. Likewise, the regulator should look at this matter seriously and ask the NSE to pay for their clients’ losses, a Mumbai-based broker said.
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With NSE shut down, brokers face traders’ ire
‘The NSE has not even communicated to us properly about the nature of the problem and when trading will resume’It may be recalled Association of National Exchanges Members of India (ANMI) had written a letter to the exchange alleging severe loss to its members due to tech glitch.
However, how the NSE handles the issue is a key element for the compensation mechanism, said another Mumbai-based broker. Suppose it shifts the expiry day to Friday for February contracts and merges today's and tomorrow's (Thursday) as one single settlement. In that case, the exchange might have to pay little compensation, he added.
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