Dr. L.C. Gupta Committee Report requires strict application of the Know Your Customer rule and requires that each customer be registered with the derivatives shredder. Members of the derivatives segment are also required to draw their clients` attention to the risks associated with derivatives trading by providing the client with the risk disclosure document and receiving a copy of it, duly signed by the customer. In the event of a delay due to the failure of a particular customer to comply with their obligation, other customers` money remains secure and cannot be used to satisfy the defaulting customer`s obligation. Derivative Exchange/Segment has not commented on the benefits of participating in this trading segment and the derivative exchange/segment has failed to demonstrate the relevance or accuracy of this disclosure document. This brief explanation does not reveal all the risks and other important aspects of trade. Given the risks, you should only make such transactions if you understand the nature of the contracts (and contractual relationships) in which you enter and the extent of your exposure to risk. The risk of loss in derivatives trading can be significant. You should carefully consider whether the business is right for you based on your experience, goals, financial resources and other relevant circumstances.
Futures trade therefore requires not only the necessary financial resources, but also the financial and emotional temperament. If you cannot afford to take the risk or are dissatisfied with the risk, the only informed advice is not to act. In the event of consequences or losses on the derivatives segment, the customer is solely responsible for this loss and the exchange or SEBI is not responsible for it and the client is not in a position to challenge the lack of adequate disclosure or the absence of reporting of the member`s total risk. The customer is solely responsible for the consequences and no contract can be revoked. Therefore, in order to have the identity of the customers of the member of the trade, it is necessary to structure the customer codes in order to identify the real person to whom the open position belongs. The customer`s contract is attached to the customer`s application form.