How to Start a Prop Trading Firm In India

[Kshiteesh_Saralaya]

Hey @ARJUN_DAS_CHAKRABORT

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How one can setup a Proprietary Trading Firm, any registration needed with SEBI, other formalities, etc?

If you are trading your own money (proprietary trading), there is no regulations as such. A partnership/LLP would be better than a pvt ltd firm in terms of taxation. As a pvt ltd firm, if you want to take out your profits, you have to pay an additional dividend distribution tax of 15%. So your effective taxation can go as high as 50%.

Forming A Prop Trading Firm (LLP)

As long as you are getting a client to confirm before every trade and record it via voice as a proof, yeah this route can be taken. The challenge here though is that as an RIA, you need to charge your fees separately and collect it separately. Whereas in a PMS you charge it on the funds you already hold. We Indians are extremely finicky when paying a fees separately. Btw, managing 100 different portfolios and executing them separately while getting confirmations is almost an im…

How can i open a prop trading firm as an LLC in India if me and my partners only intend to invest using our money?