Blitz Bureau
MUMBAI: The Securities and Exchange Board of India (Sebi) has extended the deadline for implementing new regulations governing retail investors’ entry into algorithmic (algo) trading, reported IANS.
The new rules, which were initially set to take effect on April 1, will now come into force on August 1.
This extension follows requests from stock exchanges, which asked for more time to fully implement the new standards in consultation with the Brokers’ Industry Standards Forum (ISF). The Sebi had first introduced these guidelines on February 4, aiming to regulate how retail investors can access and use algo trading. Under the new rules, there will be a three-party relationship involving stock exchanges, brokers, and algo providers.
Brokers will act as the principal, while algo providers will function as their agents. Stock exchanges will assign a unique identifier to all orders placed through these algos to track and manage them.
For retail investors using their own algos, the new regulations will require them to register their algorithms if they exceed a certain number of orders. However, they will only be permitted to let immediate family members use the algo. The stock exchanges, which will not be directly regulated by the Sebi in this system, will be responsible for registering the algo providers.
