Introducing Interoperability On Paytm Money3 min read
We are glad to announce that we have introduced interoperability on our stock trading platform. Interoperability refers to a mechanism through which trades executed on any exchange – BSE or NSE – can be settled through any of the clearing corporations. This is a major change in the way margins are calculated today and how trading happens across exchanges.
Currently, when you buy and sell stock on the same day through our platform, you are expected to complete the transactions on the same exchange. Else, it leads to open positions. Your positions are defined at an exchange level and you cannot buy and sell across exchanges seamlessly.
The Interoperability (InterOps) functionality will help you exit a position in a different exchange seamlessly.
According to a circular by SEBI, all brokers are required to provide this functionality to their customers. You can read more details about this rule in the circular here.
Read on to understand the implications of interoperability for customers and the benefits it provides.
Will interoperability affect F&O trades?
The F&O segment is supported only via NSE on our platform. So, there will be no change in F&O trades.
Impact on margin calculation
When you place orders across NSE and BSE at present, they are considered two different positions. The margin is calculated separately for each position.
Once interoperability is live on the Paytm Money stocks section, the margin required to place an intraday/delivery order will be calculated based on your positions across the exchanges.
Scenario 1: If you have an open intraday position for 100 shares of Bajaj Finance in NSE, it can be partially/fully exited in BSE without creating additional position to be squared-off.
Scenario 2: Today, if you buy stock on NSE and sell the same stock on BSE, you will have two different delivery positions – one for each exchange. These positions don’t get netted off. For the buy position, money will be blocked and you will get delivery of those stocks in the portfolio at the end of the day. For the sell position, your stocks from the portfolio will be utilised. With interoperability, this will be considered as a combined position.
Display of positions and intraday square-off
Currently, you need to square-off intraday positions individually in each exchange. If you don’t square-off yourself, square off happens automatically for each position separately.
Once interoperability is live, the quantity across both exchanges will be counted as a single position. Square-off needs to be done only if there is a non-zero net quantity across intraday positions in both exchanges combined.
Do note: Your positions across NSE and BSE including P&L will still be shown separately in the positions section. But, the positions across exchanges will be considered for deciding intraday square-off.
We are currently working on providing InterOps positions view – a combined position across NSE and BSE. It is expected to be available in the next couple of months. We will give you updates on this function as soon as we can.
Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing. For complete Disclaimers visit www.paytmmoney.com
