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Is the above absolutely clear to you?
Not misinterpreting/misunderstanding any parts of the response on the ticket, right? -
If yes to 1, have you asked on the ticket - “Why 100% close-out if Zerodha RMS did have some shares?”
- If not, then ask on the ticket.
- If already did maybe need to review/understand the response to that.
- Also, IMHO, there is no fair-unfair here.
How do you know what they did wasn’t the most fair overall.
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Perhaps there may have been some other individual who’s short a larger amount and these available shares were used to partially fill their short position?
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Or perhaps the RMS chose the option to distribute shares between the various short individuals in the least complex way for them logistically?
Instead of trying to seek something subjective like fairness,
how about we focus on
what all is the broker/RMS legally required/mandated to do in this situation, hmmm?
-
Is it legally required that
when an RMS has some shares,
they have to equally partially distribute them
across all the individuals that are short? -
Is there any other mandate on
how the RMS must distribute shares across individual accounts that are short? -
Is the broker/RMS free to partially/fully fulfill any individual account at their discretion,
and let the other accounts hanging / trigger a close-out?
I do NOT see any value in trying to understand the logic Zerodha RMS may have applied in distributing the available shares at their discretion as that can change in each instance / over time.
If it is legally mandated to distribute at the broker/RMS discretion,
then best to assume 100% close-out risk in one’s risk-assessment calculations
(and subsequently thank our stars if the RMS is able to get any shares and partially fill our short order)
If you are unsure/unaware on what is legally required in this situation,
and receive no further clarifications / responses on the ticket
and no one else on this forum comments about what is legally mandated in this situation,
please post this query in your feedback on SEBI SCORES.
PS: On a side-note, Zerodha not engaging more on this topic-thread publicly
to educate everyone interested about this scenario,
makes it appear as if
- either they themselves do not have sufficient clarity.
- or the broker’s and individual’s incentives do NOT align in this scenario,
and they would rather not draw attention to this.
(it is what it looks like, even if perhaps the lack of detailed/clarification/responses is due to them being busy with other work, or due to any other legal reasons why they cannot publicly comment on the individual scenario.)