I have a series of questions regarding compliances and regulations around these trading strategies, are they considered legal and bear no compliance issues with Zerodha, NSE, BSE or SEBI, here are the questions,
Assume, all of the scenarios written below is done by a retail traders and the coding is also done by him, there is no exchange of services with anyone, everything is done in-house by the trader himself:
Say, there is a strategy which is coded and runs independently which creates signals using which Trader fires off his trades using the web platform of Zerodha - Are there legitimately any concerns about this setup? My assumption is that there should be none, and it shouldn’t even be considered algo-trading in the first place, but I would still like an answer from an expert or authorized professional from Zerodha folks.
Can you build web extensions yourself to add extra features on top of Web Kite Platform? Nothing crazy, just adding some better display indicators, P/L statements, macros, etc to help yourself in trading.
Are there any restrictions/compliance issues on placing big market orders (30L+) using intraday leverages and then squaring them off within seconds (2s-20s) and profiting off the scalping strategies especially during volatile hours in the volatile stocks? (market opening and market closing)
What if above is done using coded strategy which quickly created the signal, again absolutely stressing on the fact that then the user manually (i.e. click/press) placed a large intraday order and squared off within 2 seconds and earned himself a profit by using volatility for his benefit.
**So, what are the legal grounds for the above 4 scenarios? Are they perfectly legal and compliant with current regulations of exchange, broker and SEBI? Are there are tips you want to share to assist retail traders who do the above? Any risks of future grievances? audits? notices? that maybe sent to traders who do the above? **
Personally, I see no difference between them and a platform like Streak.tech except this platform is made by oneself according to his own needs, no automated trading occurs, only an effective scanning is done to create signals on which a trader can choose to trade or not trade manually but the moment of decision making is very small in seconds.
What are your general opinions? Please feel free to tag people with better and detailed knowledge on this subject below in the replies, for the time being tagging @nithin@siva as the two people who I see most answering questions in the forum.
Also, Thank you on the behalf of the entire Indian retail traders, Zerodha is by far the biggest innovator in Fintech space in my personal opinion, the environment and ecosystem you have created should be applauded, I love the platform and I love your fight for the retail traders against the regulators. Hoping for you guys to continue crushing in and stay innovative while protecting the rights of the retail traders and most importantly their freedom.
If you are doing it for yourself and clicking on the trade button manually, there is nothing illegal about it. Ideally there should be no issues even if you do through APIs, but exchanges/SEBI seems to be not okay with it.
If you are doing it for yourself and clicking on the trade button manually, there is nothing illegal about it. Ideally there should be no issues even if you do through APIs, but exchanges/SEBI seems to be not okay with it.
Hey @nithin Thank you so much for your response! Apologies in advance to pester you again, but can you please address the other 3 points as well? How do they look compliant wise? Specifically, as I quote again:
Can you build web extensions yourself to add extra features on top of Web Kite Platform? Nothing crazy, just adding some better display indicators, P/L statements, macros, etc to help yourself in trading.
Are there any restrictions/compliance issues on placing big market orders (30L+) using intraday leverages and then squaring them off within seconds (2s-20s) and profiting off the scalping strategies especially during volatile hours in the volatile stocks?
What if above is done using coded strategy which quickly created the signal, again absolutely stressing on the fact that then the user manually (i.e. click/press) placed a large intraday order and squared off within 2 seconds and earned himself a profit by using volatility for his benefit.
Again thank you for taking time to address all kinds of queries in this forum, I am really grateful and appreciative of your work for the betterment of the society since I am certain you are extremely busy in your life and still taking the time out to help the forum and this community of lovely traders.