Sebi likely to set trading limits for retail investors, says report

Markets regulator Securities and Exchange Board of India (Sebi) is likely to set a trading limit for retail investors on the basis of their income or net worth, The Hindu BusinessLine reported.

This means that the retailers who participate in equity and commodity markets may be required to submit a net worth certificate to their brokers.  Their trading limits cannot exceed their income levels, the report said.

Net worth is the value of all financial and non-financial assets owned by an individual minus the liabilities. Hence, if the net worth Rs 10 lakh, the trading limit should not exceed that according to the proposed move.

"Sebi is likely to consider the recommendation and implement it in 2018," sources told the paper adding that the regulator may bring a 40-50 percent cap on the position limit of retail players in the derivative segment.