Algo trading to open up for retail investors soon
Hindustan Times Noida|December 14, 2024
Algorithmic trading, which has remained the preserve of large institutions, could soon be open to India's retail investors as well, with the market regulator proposing a framework with critical roles for brokers and stock exchanges.
Neha Joshi
Algo trading to open up for retail investors soon

MUMBAI:

In a consultation paper floated on Friday, the Securities and Exchange Board of India (Sebi) suggested making algo trading available to retail investors through licensed brokers, who will register clients' algorithms with exchanges, ensure compliance with rules, and watch for irregularities.

In 2012, Sebi opened algorithmic trading for institutional investors through its Direct Market Access (DMA) facility. Its latest proposal aims to bring benefits such as faster order execution, reduced transaction costs, greater transparency, better audit trails and improved liquidity to retail investors as well. Sebi proposed that these algorithms may be extended to an investor's immediate family, including spouse, dependent children and parents.

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