ONLINE ARBITRAGE RISK MANAGEMENT WHITE PAPER

Transcription

1 ONLINE ARBITRAGE RISK MANAGEMENT WHITE PAPER

2 DOCUMENT RELEASE NOTICE This document is subject to the document control procedure and revision. Comments, suggestions, and queries should be addressed to India holds all the rights on this document. No part or Full of this document shall be replicated or copied. This document shall not be misused by the copyright holder / owner. The purpose of this document is for the information of the existing and prospective business partners, the various support groups and members in Kolkata, Chennai, Hyderabad, Delhi and Mumbai.. Prepared/Updated By BDT Date Reviewed By BDT Date Approved By BDT Date RELEASE NOTE Name Of The Document: ONLINE ARBITRAGE RISK MANAGEMENT WHITE PAPER Effective date: Version: 1.0 Total no. Of pages: 36 Doc ID: SWP-ONLINEARBITRADERISK.PDF Issue Date: Reviewed by: HODs Prepared by: BDT REVISION HISTORY Version Ref (Released) 1.0 Release Date 10-Jan Created/ Revised by BDT Reviewed by HODs Description of the Revision Created as part of the Information dissemination Affected Sections in the Manual First Release Remarks

3 WHY SHAREPRO ONLINE? Arbitrage is the availing of an opportunity of price differential in markets. It is the next best thing in Stock Broking. Over a period of time more and more brokers have developed expertise in buying-hereand-selling-there. However, like everything in the stock market, Arbitrage has its own risks and requires continuous second-to-second monitoring. But how do you monitor a growing army of arbitrageurs? This is where SharePro Online comes in as a perfect tool for you. It connects to SharePro Backoffice system for open positions, to the Trading System for online trades and rates, and generates live positions for monitoring by Arbitrage Leaders. HOW DOES SHAREPRO ONLINE WORK? Sharepro online connects to the SharePro backoffice server on the one side and the trading system on the other and generates cross-segment [CM and Derivative] positions for Arbitrageurs. An Aribtrageur here is a unit consisting of one or more NSE-CM trading terminal and one or more F&O Trading Terminal. It also connects to the Internet, periodically downloads the Span Parameter files published by the exchange and calculates SPAN. It then feeds the current status to individual Arbitrage Leaders who monitor a group of Arbitrageurs.

4 WHO ARE ARBITRAGE LEADERS? Arbitrage Leaders are the leaders of a group of arbitrageurs having NSE-CM and NSE-F&O Terminals. SharePro online allows the arbitrageurs to be grouped under leaders [or users, if you may]. When individual leaders view the online monitoring, they view only their arbitrageurs. To put simply, Aribtrage Leaders can also be called Users. In the snapshot on the right, the Manager of the system is creating a Arbitrage Leader and pushing arbitrageurs under him. Interesting Point: A single Arbitrageur can be placed under multiple Arbitrage Leaders.

5 WHAT CAN WE MONITOR? A leader monitors arbitrageur positions. The positions are available Instrument wise, Underlying wise, In detail, In summary, and so on and so forth. The above snapshot shows Arbitrageur wise Summarized Money positions Arbitrageur wise Instrument wise positions

6 Arbitrager wise Exchange wise Money positions Underlying wise Firm's positions

7 Arbitrageur wise Underlying wise positions Arbitrageur wise SPAN consumption

8 WHY SHAREPRO ONLINE? Unlike other similar products available, SharePro online is a Client-Server application that connects to a database. This means that the Server and the Monitoring consoles are distinct and completely independent applications. Consequently, multiple monitoring consoles can be installed in your organisation for different Arbitrageur Leaders. SharePro online has another distinct advantage of monitoring Arbitrageurs and not Terminal IDs.