Is there advantages of setting up Prop Trading desk in Gift City (IFSC Company)? I know there is no STT in Gift City
Why broking firms register a fresh company in IFSC rather than migrate existing company to Gift City?
Prop desk that focus on Derivative Trading , setup a company in IFSC or go with normal company?
Being in GIFT city is like being in a different jurisdiction (outside India). So Indian companies canât migrate.
Prop traders looking to trade international markets or on the exchanges within GIFT are the ones who are setting up shop there. You canât move there and trade Indian markets to avoid STT. 
So can one setup a company in gift city and trade forex or cfd outside India legally ?
Hey @nithin sir ; what if the plan is to find such profitable traders and allocate funds to them in return for a nominal fees. What would be your plan of action to execute this plan?
Assumptions:
1)The RMS and Frontend could be built on top of the Kite APIs.
2) The entity could partner with Zerodha as a DP so in turn the Infra and tech stack would be yours and we donât need an active NSE membership to start with.
In this case when we build on top of your APIs apart from getting access to the Zerodha existing client base do we also get any deductions in the brokerage or is it same for all participants?
No, you cannot.
We donât lease out our infra for stuff which is regulatory grey. You would have to take your own broking license.
How is regulatory grey area?
Because we already have existing prop desk firms in India. To speed up the setup process collaboration in terms of technology would be of great help for a headstart ; because you yourself have been through it and know the hassles , time and efforts needed to setup a broking license today.
U r a prop firm, as in a broking firm (with license) already?
No I am not associated with any prop firms or I donât have a broking license as of now.
I want to build in this space for mass retail traders and thats the reason I am seeking help and guidance from your end.
I have also reached out to you on your mail.
The sender email id is [email protected]
Appreciate and respect your valuable insights and help.
The only clean way to run a setup like this is to become a stockbroker. Allocating funds, etc, is regulatory clean this way. If you become a broker, we canât extend our technology to you.
Understood.
How about an arrangement where we could be a sub broker or AP with Zerodha. I understand the point that no one would want to share the tech stack to a possible competitor but for us the motive is evaluate talent and provide them the funds and hence use the Kite API for backend execution on top of which we could build our own custom condition based front end (RMS) . We want to build in the funded account space and not the brokerage sector.
I believe you along with your team at Rainmatter are looking for innovations and products in the fintech industry which can benefit the Indian audience at large .
Thatâs one of the reason we would love to collaborate or find a way out where we could build something which makes trading and investing a better , safe and ideal full time career with your help and support.
Not possible even as an AP of Zerodha.
This isnât really innovation, that is why this is not on our list of things to do.
Thanks again for your time and feedback.
Hi @nithin sir
Is it legal to make funded trading firms for Indian markets ?
Where we can offer demo accounts for evaluation and traders who pass the challenge within strict risk limits and other rules are given another demo account/real accounts where if they make any money above a threshold they can withdraw all of the money. Only a small one time fee can be charged for demo account, those who fail, will have to buy this again, those who pass the evaluation will be given the next account which can be demo or real. Since a majority of traders lose, company will generate revenue by their one time fee, and theyâll spend a small fee to get big accounts. Itâll help traders to test if they can be profitable by losing small amount and the rules will make them better traders. Consistently profitable traders can get access to larger capital so they wonât have to risk similar amounts of their own.
I wanna do it for futures only, since we canât use data from NSE directly, can we use it from tradingview, or some other source and what about MCX? Where can I find all legal requirements, and answer for these kind of questions?
Yeah, it is illegal.
