Do's & Dont's

      • Read, understand and be updated about the guidelines and circulars of the Exchange and of the Forward Markets Commission.
      • Refer and understand all the provisions of Forward Contracts (Regulations) Act, 1952 and Forward Contract (Regulations) Rules, 1954 dealing with futures trading in commodities and amendments thereof from time to time, including provisions and rates relating to the sales tax, value added tax, APMC Tax, Mandi Cess and Tax, octroi, excise duty, stamp duty, etc., applicable on the underlying commodity of any contracts offered for trading by Ace Derivatives and Commodities Exchange Limited (hereinafter referred to as Ace).
      • Read the commodity contracts circulars issued by Ace and carefully note the contract specifications of the commodity in which you wish to trade. The contract specifications are subject to change from time to time.
      • When establishing relationship with a new client, take reasonable steps to assess the background, genuineness, financial soundness and investment objectives of such client.
      • Obtain duly signed client registration forms, member client agreement and risk disclosure document from all constituents.
      • Member should allot a unique client code to the client.
      • Before entering into buy and sell transactions please be aware of all the factors that go into the mechanism of pricing, trading and clearing.
      • Members shall buy/sell derivatives contracts on behalf of the constituent only on receipt of a margin on the prices of derivatives contracts proposed to be purchased/ sold.
      • Members shall obtain a written undertaking from the constituents that they shall, when called upon to do so, provide a margin deposit and/or additional margin money as required in respect of business done for the constituents by the member.
      • Members shall issue signed contract notes in the prescribed format to their clients/constituents for trades executed within 24 hours of the transaction.
      • Members shall keep copies/duplicates of contract notes issued and Contract notes shall be numbered with unique running serial number.
      • Members shall at all times keep moneys of constituents in a separate bank account and their own money in a separate account. No payment for transaction in which the member has taken a position, shall be made from clients’ account.
      • Members shall keep such books of accounts to distinguish moneys received/paid on account of each of their clients and moneys received/paid on their own account.
      • Members shall make full payment of funds to their constituents within 24 hours of receipt of relevant payout from the Exchange.In case of any disputes in respect of the trades on the Exchange or in the contract notes or any complaint against the constituents, take up the issue with constituent directly. In case of non-resolution, invoke Arbitration Mechanism of the Exchange within 6 months from the date of cause of action.
      • Member shall not carry out business or execute any deals for any member, who has been suspended, expelled or declared defaulter by the Exchange.
      • No money shall be paid into the client’s account other than money held or received on account of clients; or money which may be required for the purpose of opening or maintaining the account.
      • No money shall be drawn from client’s account other than money required for payment on behalf of clients for or towards payment of a debt due to member from clients.
      • Member shall not deal on or access the Trading System of the Exchange through another member or on behalf of another member without prior approval of the Exchange.
      • Members shall not indulge in fund based portfolio management services.
      • Go through the Rules, Bye-laws, Regulations, Circulars, directives, notifications of the Exchange as well as of the Regulators, Governments and other authorities and details of Client-Trading Member Agreement to know your rights and duties vis-à-vis those of the member.
      • Trade only through registered members of the Exchange. Check with the Exchange to see whether the member is registered with the Exchange.
      • Enter into a Member –Client Agreement with the member and insist on filling up a standard 'Know Your Client (KYC)' form and on getting a unique Client - Id.
      • Understand the Delivery & Settlement Procedures of the commodity that you wish to deal in the futures market.
      • Study historical and seasonal price movements of the commodity that you wish to deal in the futures market.
      • Pay required margins on time and only by cheque and ask for receipt thereof from the member. Issue cheques /drafts in your member’s name and receive cheques/drafts in your name.
      • Set out in writing, orders for higher value given over phone.
      • Pay all applicable margins on futures position to the member. Also, collect/ pay mark-to-market margins from/to the member which are required to be settled on a daily basis.
      • While trading through an authorized person ensure that a duly signed contract note has been issued by the highlighting the details of the trade along with your unique Client-Id.
      • Cross check the genuineness of trades carried out at the exchange through the trade verification facility available on website.
      • Insist on receiving the bills for every settlement.
      • Insist on periodical statements of your ledger account.
      • Ensure that the Contract Note contains all the relevant information such as Member Registration Number, Order No., Order Date, Order time, Trade No., Trade rate, Quantity, Arbitration Clause.
      • Ask all relevant questions and clear your doubts with your member before transacting.
      • Obtain receipt from members for collaterals deposited with them towards margins.
      • State clearly who will be placing orders on your behalf. Give precise and clear instructions while placing, modifying or canceling orders.
      • Freeze your Demat account in case of your absence for longer duration or in case of not using the account frequently.
      • Pay required margins in time and only by Cheque and ask for receipt thereof from the member.
      • Apply your own prudent judgment for investments in commodity futures and take informed decisions.
      • Do not deal with unregistered members / authorized persons even if their charges are lower and/or margins are lower.
      • Do not start trading before reading and understanding the Risk Disclosure Document and entering into the prescribed agreement with the Member.
      • Do not get carried away by luring advertisements, rumours, hot tips, promise of unrealistic returns, etc.
      • Do not accept unsigned/duplicate contract note/confirmation memo.
      • Do not accept contract note/confirmation memo signed by any unauthorized person.
      • Do not delay payment/deliveries of commodities to member.
      • Do not sign blank without reading the contents of Member Client Agreement.
      • Do not undertake off-market transactions in commodities with a member of the Exchange, unless such member records in the agreement for sale, note or memorandum that he is selling/purchasing the goods as the case may be, for his own account and obtains a consent from you in respect thereof as required u/s 15 (4) of the Forward Contracts (Regulation) Act, 1952.
      • Do not go by the reports/predictions made in various print and electronic forms without verification.
      • Do not trade on any product without knowing the risk and rewards associated with it.
      • In case of any disputes with the Member regarding the trades done on the Exchange platform, the client could contact the Exchange for suitable redressal as per Bye laws of the Exchange including use of mediation/arbitration mechanisms of the Exchange. The clients would be required to produce copies of the agreements entered into by them with their member, for obtaining relief through the process of arbitration. Hence, clients are advised to obtain copies of signed agreement from members and keep such copies with them. Further, all copies of all correspondence to and from members may be preserved for producing them to the arbitrators, if required.
      • All rights as per the Rules, Bye Laws and Regulations of the Exchange are available to a client in respect of all transactions traded on the Exchange and for which the clients have a contact note duly issued by the member.
      • In case of any disputes in respect of the trades on the Exchange or in the contract notes or any complaint against the member, take up the issue with member directly. In case of non-resolution, file written complaint against the member with the Exchange within 6 months from the date of cause of action.