Trading Client :Traders or so called Investors

Agenda

Trading

Who is a Trading Client?

Traders vs Investors

Trading Clients: NSEL

HNI Traders

Pankaj Saraf NSEL’s HNI Trading Client

Conclusion

Trading

Trading is one of the key functions of investment banking

Trading is an activity of buying and selling of securities or commodities

Who is a Trading Client?

Individual who engages in short term trading & is known as ‘Trader’

Trader engages in the transfer of financial assets in any financial market, either for themselves, or on behalf of someone else

Traders v/s Investors

Traders Investors

Time Short-Term Long-Term

Costs Higher Lower

Risk

involved

High Low

Returns Depends on market

trend and volatility

Higher

Trading Client: NSEL

They were not creditors of NSEL

They did not even invest in FDs/Debentures in NSEL

Brokers traded on behalf of NSEL Trading Clients

HNI Traders

781 clients which is 6% of 13000 affected trading clients were HNI clients

These clients mutually have to receive an amount of Rs.3,605 crore

HNI clients have an unresolved amount exceeding Rs.1 crore

The suspicion was that most of the funding provided to these trading clients was from their respective Broking Promoted NBFC’s

Pankaj Saraf NSEL’s HNI Trading Client

Pankaj Saraf is a NSEL trading client

In a recent television interview he spoke of having thought of ‘writing off’ his money that was traded on NSEL

This clears that Mr. Saraf is a ‘trader’ and not ‘investor’ as projected by him

CONCLUSION

The main aim of these traders who traded on NSEL was to make quick money

This brings us to interesting question which needs to be asked is that are these so called ‘investors’ of NSEL actually ‘investors’ in the true sense or ‘traders’ as facts point them out to be?

Thank You

Image in for presentation purpose only.