They only give for intraday trading, not for FnO.
all investment companies are to be classified as NBFC. need rbi approval, which they are not going to give. truly unfair is what it is. small guys cant start investment companies!
need rbi approval for starting an investing company… which they dont give i presume since alternative investment fund model is there. also, LTCG for such an LLP(even if rbi allows) will be 20%, far higher than mutual funds…which is 10%. makes no economic sense to me. companies can invest provided 50% of their profit do not come from investment activities. or/and 50% of their assets arent financial products.
Sir what if a few of my friends decide to pool our money together for the purposes to trade and make a partnership will that be illegal?
Thank you so much for the reply Sir
Sir I had another doubt that whether discussing about stocks(technical analysis along with price targets etc.) amongst family and friends amount to as a violation of SEBI’s Investment Advisor and Research Analyst regulations?
With friends and family should be okay I guess, only thing is do not advertise them or put it on social media out for all, also by chance if they complain against you that they lost money based on your recommendation then you will be in trouble.
As long as you don’t collect fees, it should be okay.
Actually Sir the discussions are always mutual we decide amongst ourselves and take trades from our own personal trading accounts … So is it by any chance a violation that we are recommending stocks to each other?
@nithin @
Thank you Sir
Sir, Partnership firm attracts 30% Income tax but Private Limited attracts 25% Income tax. So for people with capital say 1 cr & above. Is Private limited the best option to save income tax?
If you are setting the pvt ltd company and its main purpose is trading, then yeah it is an issue. If more than 50% of income comes from this activity, you might have to get an NBFC license. Also selling shares might seem like you are circumventing the collective investment scheme regulation. Think about it, everyone would do it this way instead of having to take AIF or PMS license, if it was this easy.
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Thank you sir,
Instead of a Partnership firm, can we form an LLP for trading as the only purpose?
In LLP also 50% of income comes from a trading activity means we might have to get an NBFC license?
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You can’t have the objective of an LLP as “investment/Trading”. You can potentially start an LLP with a different objective and still trade/invest. But this opens up potential future issues.
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Sir, If i have a LLP and do not take any money from investors, can all the directors trade using the LLP Demat and own money?
In this case partnership won’t do?
Procedure to open Partnership Firm Trading and Demat Account.
You will have to search on the SEBI website for Cat 3 AIF. Here are a couple of links to get you started.
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A CEO on the Forbes list, personally and thoughtfully responding to forums? I never imagined it was possible. Seeing, however, is believing.
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