Which illiquid stocks are blocked

@nithin @siva

With reference to below can u kindly list all those illiquid stocks which are blocked by you?

What happens to those that are already purchased and sitting in demat?

Why taking regulator role now?

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explained here

Zerodha has created “Nudge” for illquid & penny stocks. This makes buyers aware of the risk associated with it. I don’t understand why they are not allowing us to buy now when market is really low. Pump and dump schemes mainly operated during the bull run where investors are euphoric. They are not allowing even after creating a support ticket. If they are so much worried about retail investor why they allow them to trade in FNO?

@nithin I’ve enabled TOTP and used it to login to kite. But the nudge alert still says, “Intraday trades are not allowed.” because it is an illiquid security.

Now that the phishing scam would not be possible since we login using TOTP, why are intraday trades still not allowed?

On debt instruments we don’t allow and on few very illiquid and low value stocks , on t2t scrips it is not allowed, so, can you give me the name of that scrip? I can confirm on the reason.

@siva @nithin
The scrip is Lambodhara Textiles

Although it is a microcap company, it is a fundamentally sound company. It is listed both on NSE and BSE and has been consistently profit making and been paying huge divdends for the past several years.

Request you to enable intraday trading, atleast for those who have enabled TOTP

Just seen that, spread between bid and offer is itself 2 %, anyhow this list is not static, it is dynamic, if we notice volumes are picking along with other few internal criteria the stock will move out of this list.

But @siva, if the spread between best buy and best sell is high, how does it impact your customers? I understand that without TOTP, stocks with low liquidity can be used to generate losses to victims of phishing and profits to the scammers. But when TOTP is enabled, why is high spread between best buy and best sell price still a concern?

I just mentioned it, as said we have few internal criteria,and the list is dynamic , keep changing every week.

@nithin The role of a broker is to offer a reliable trading platform to buy and sell stocks. It is NOT to play the role of a regulator and add stocks to your own self-created trade to trade segment, based on your internal criteria. The restriction on intraday trading in micro-cap stocks does not make any sense now, since you already have a system to prevent the phishing scam.

I’m sorry to say this, but after being with you for 6 years, I guess it is now time to open an account with another broker like Upstox or Groww which would provide a hassle-free way of investing/trading in micro-cap stocks without any restrictions.

@Roy @nithin Roy there is a background to why zerodha alone is restricting penny stocks

Last year in sep 2019 the 7nr mourya udyog agrophos manipulation scam took place. They sent bulk sms in a zerodha alike looking id. And the mobile numbers of mostly zerosha customers got leaked. Many people suspected zerodha role in mobile number leakage.

Adding to this people also got victimized by zerodha phishing scam.

There was a doctor from Karad India who is a professor in psychiatric research institute. His entire holding was sold and a scrip called salasar exterior got bought.

So to avoid further bad name zerodha imposes penny stock restriction

Dont be surprised if this comes under sebi radar.

Who did this ? Client or the broker ? Without the password how could third party login to his account ? Did he file complaints to nse sebi ? What was the result verdict ?

Read this.

That was a phishing attack case…but why only zerodha is targetted?

Why zerodha became nervous after 7nr scam and now doing damage control by blocking penny stocks ?

There is something amiss in this entire episode

But how did the login passwords leak ?

Let me try to make it simple( personnel view) . This isn’t focused only on Zerodha.

Because majority of the clients are newbies and are unaware of all these things happening in the market. Zerodha is trying their best to prevent these kinds of activities in the market. If you are losing money as soon as you step into the stock market, I don’t think you will be interested to trade anymore.

Its nothing like login password leak and i strongly believe none of the brokers do it. Say you are entering into the stock market after getting so much of hype that you can make quick money. And if you have 0 knowledge about the stock market, you ll fall into fake SMS/calls that you receive promising that they will give you a good profit. And the tipsters/scammers get the login credentials from the clients who blindly trust these fake SMS/calls.

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@siva today most of stock option are blocked due to liquidity , see bid ask in ibul 100 pe , its fairly liquid still zerodha asking totp , same is the case with stocks like canbk etc which have enough liquidity to trade without the need of totp .

Yes, for far OTM/ITM, one should use TOPT to trade in those.

can call and trade be done for this . currently totp is not enabled. previously if we placed order close or at bid-ask price it would have executed but from today its also not working .any other way