Securities Board of Nepal Issues New Directive to Regulate Margin Trading in Capital Market
Summary
The Securities Board of Nepal has issued a directive regulating margin trading in the capital market, establishing eligibility criteria for brokers and setting margin requirements to ensure systematic and risk-controlled trading.
Key Points
- The Securities Board of Nepal issued the Margin Trading Facility Directive, 2082 to regulate margin trading in the capital market.
- Brokers must maintain a minimum paid-up capital of NPR 200 million and be clearing members to provide margin trading facilities.
- Minimum initial margin of 30% and maintenance margin of 20% must be maintained by investors trading on margin.
- Brokers can provide margin facilities up to five times their net worth, with a 10% margin limit per client to control market risk.
