InvestorQ : How does the exchange monitor positions and risk online?
Maniish Lofar made post

How does the exchange monitor positions and risk online?

Answer
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Bhavik Nehru answered.
2 years ago


On the National Stock Exchange (NSE), the online monitoring of risk is handled by the National Stock Exchange Clearing Corporation (NSCCL) which has put in place an on-line monitoring and surveillance system, whereby exposure of the members is monitored on a real-time basis. A system of alerts has been built in so that both the member and the NSCCL are alerted as per pre-set levels (reaching 70%, 85%, 90%, 95%, and 100%) as and when the members approach these limits.
The system enables NSSCL to further check the micro-details of members’ positions, if required and take pro-active action. The online surveillance mechanism also generates alerts/reports on any price/volume movement of securities not in line with past trends/patterns. Open positions of securities are also analyzed. For this purpose, the exchange maintains various databases to generate alerts. These alerts are scrutinized and if necessary taken up for follow up action. Besides this, rumors in the print media are tracked and where they are found to be price sensitive, companies are approached to verify the same. This is then informed to the members and the public.