Siva if derivatives are not allowed in US markets then how would one hedge their portfolio against risk?
That wouldn’t be considered as Margin trading and hence I guess can be justified. I don’t think LRS mentions anything against trading in derivatives, they only state margin trading is not allowed.
1 Like
Waiting for Zerodha to Open up Overseas investing for Indian Retail Participants…
one of the best tihing in US market all bluechip companies will declare dividended every quarter that means every 3 Months -
3 Likes
Oh That is nice Riyas … Good Cash Flow 
1 Like
May be buy ETFs, also another risk would be currency risk, if rupee appreciated during that time your returns may diminish but yes retailer can’t hedge any of these risks.
Also not sure how many would be using derivatives to hedge their portfolio , it will be mostly used for speculation at-least by small traders.
1 Like
It does, margin trading along with using leverage is prohibited under LRS.
if anybody concern EMBASSY REIT in india, its giving awesome returns and every quarter giving good dividended . no volatile 1 year below return 47% every day up by 2 RS dividended they re increasing every quarter please check it all currentlt per share 6 rupees dividended every quarter
2 Likes
That’s good. Is there enough liquidity in it?
enough liquidity available
Yes, I think that’s what I said. But using derivatives, does not default to margin trading or using leverage. Like cash secured puts or risk refined strategies where the risk is fully paid for upfront, i.e if the instrument is cash settled and not physically settled, because that assumes some risk of delivery if spot closes between the legs. I’ve researched on this and spoke to some experts and found it to be legal. Basically trading in US cash account and not in margin account . Cash account does not allow margin trading or use of leverage and still allows us to do some options trading.
BTW, the above mentioned is based on my research, please don’t quote me, do your own research before proceeding. Cash account is not that useful anyways for traders but we are just trying to interpret LRS here.
1 Like
Hello namit i had a question that what type of options we can trade from india in us stock market options cause when i called tdameritrade for my application they said that i can only trade on covered calls and long positions cand you help me on that?
Find a broker which allows hedged options position in European style cash settled options. Only those are allowed in Cash account in the US but not all brokers support it. Again, I don’t know if this is legal, this was my interpretation. Do your own research. I think @nithin has explored more on this topic than I ever can, you should take his suggestion.
iam in india and want to buy and sell shares on the same day (day trade). i have a cash account in T D Ameritrade … please help me…
leverage and intraday not allowed as per fema rule
Bro if u have lawyer friend u can put a PIL in court to uplift any ban on any market trading as Indian market is also not safe if u leave position without stop loss more over forigen market has zero debit platforms such as mt4 that gaurntees zero debit that is before your account is close to zero due to loss position system will send autosqaureboff market order I have seen this on forex trading so overall we say we are in open world but in India still closed old book where oldies are ruining the nation
You can buy shares and sell Intraday but u require 25000$ minimum for that or else exchange will block ur account for intraday trading shares can be bought and sold no.issue with that only thing ban is leverage trading such as short call futures u can buy naked call and put but not sell call and put
but sell and buy in intraday , not allowed !