how to invest
How to Invest
Exposure Limits:
The KSE has an effective var based Risk Management System under
the regulation governing Risk Management of Exchange. As a part of
risk management, KSE has devised circuit breakers as under.
T+2:
There shall be a circuit breaker in case of price fluctuation 5%
or Rs. 1.00, whichever is higher, from the closing price of the
previous day. Accordingly trading will be restricted within upper
and lower limits of 5% or Re. 1.00 whichever is higher from last
closing price.:
Futures Contract:
There shall be a circuit breaker in case of price fluctuation 5%
or Rs. 1.00, whichever is higher, from the closing price of the
previous day. No trade in the Futures Contract market will be
allowed beyond the above price fluctuation In order to strengthen
the Risk Management, the amount of Net Capital Balance has been
enhanced to Rs.2.5 million under the Capital Adequacy Ratio the
members are allowed to trade up to 25 times of the Net Capital
balance.
Clearing House Protection Fund:
In order to ensure smooth settlement, the KSE has established a
Clearing House Protection Fund. In case of default of a member,
shortfall, if any, is fed through this fund up to a certain limit
as approved by the Board from time to time. The contribution to
the Fund is made by the members of the Exchange.
Investors Protection Fund:
An Investors Protection Fund has also been established to protect
small investors from the consequences of a member's default. The
fund is operated under a set of Regulations.
Market Surveillance:
The advent of the Automated Trading System has enhanced the market
surveillance capability of KSE to devise a market control system.
An independent Market Control and Surveillance department has been
established to monitor price fluctuation and trading patterns to
ensure compliance with regulations and detection of speculative
activities.
Minority Shareholder's Interest:
The Exchange has played a proactive role in safeguarding small
shareholders' interest and has strengthened its monitoring and
enforcement capability to ensure corporate governance. During past
couple of years a number of cases have been referred to the SECP
in this regard.