NSE and BSE have taken an abrupt decision to start trading one hour early. While the idea is to have market timings more in line with trading hours prevalent in other global markets it will make sense only if certain other changes take place in the way exchanges and banks function here. Firstly banks must start opening at least half an hour before trading resumes. Also RTGS system should start functioning well before the market starts so that any shortfall in margin can be transferred by the broker well in time.
Apart from this the NSE current system updates the margin, position and other files in their intranet only by 5:30 in the evening. Brokers have to then update their client positions and generate contract notes for the transactions carried out during the day. Also transaction confirmations have to be mailed or faxed to various clients. All this needs at least one hour of office work after 5:30 PM. In the morning systems have to be logged in and exposure limits for various clients have to be set for various clients. Besides this various brokers also have morning updates and trading strategies sent to clients before the market opens. This means that broker offices have to become operational about an hour before trading starts. Practically this translates into working hours of staff at any broking outfit from 8:00 AM to 6:30 PM. This anyone would agree is very heavy compared to other industries and also the international markets. This new timings from the exchanges ignores the human element and the strain on infrastructure that it will cause. For the system to work exchanges must also improve their efficiency in updating various data files required by the back offices of brokers. If all the files are available required by brokers from the exchange are available at 4:00 PM then office timings can be from 8:00 AM to 5:00 PM, which nobody will complain.
No comments:
Post a Comment