ASKED QUESTIONS (FAQs)
We reproduce some of the questions, which are repeated
asked by clients. These Q&As may help you understand the working of the
stock market. If you too have any question in your mind please send us your
I have found
your site very useful; I am a housewife and would like to know whether I can
open an account with you?
much do I need to open an account?
have physical shares of PTC can I sell them immediately?
the concept of Carry Over ( Badla ) is not clear to me kindly explain as briefly
I have down
loaded your Standardized Account Opening Form (SAOF) and gone through the Terms
& Conditions. I would like to know how much margin will you retain and what
is the purpose of retaining this margin?
have seen a great deal of hype about online trading. Do you provide any such
service, if yes what is the difference?
want to invest in the stock market but my friends tell me to beware. They say
the Stock market is nothing more than a gambling den. What do you have to say
Exchange is a closed club. What can one do if a dispute arises with the broker,
is there any official redressal mechanism?
Thank you for your appreciation it is feed back
from people like you, which encourages us to
constantly improve our site. Yes you can open
an account with us in fact any individual, joint
account holder, firm or corporate entity can
open and maintain an account with us.
The minimum requirement for opening an account
with us is Rs 25,000/- or share deposit of equivalent
Most shares have now become electronic i.e the
physical shares have to be sent to the Central
Depository Company (CDC) where the shares are
converted to electronic entries. Once the shares
are available in your sub-account with the broker
they can be sold immediately. It is recommended
that you convert all your physical shares to
CDC for ease of transaction in future.
Carry Over Trading (COT) or Badla as it is locally
known is a financing mechanism. It simply means
that the traders who want to carry forward their
trades to the next day can do so through the
COT trade. The COT market provides an opportunity
for those with surplus funds to invest in a
relatively safer avenue and get reasonable returns.
Please note that the rate of return is not fixed
and varies every day. However you can have an
overall idea of the COT rates by visiting this
We normally maintain a margin of 30%. The margin
acts as an early warning signal for the client
and he becomes aware that he needs to reduce
his position in order to avoid further losses.
Once the position goes below the prescribed
margin we alert the client so that he can either
increase his deposit or reduces his position.
Yes there is a great deal of media hype about
online trading this is part of marketing strategy
by some brokers. The fact is that the actual
terminals of Lahore Stock Exchange (G) Ltd.,
are available for remote trading by clients.
Your orders directly reach the serv ers of LSE
and are not routed through 3rd party
soft wares. In addition to the Remote Trading
terminals clients can trade through the web
too. For more details Go to Online Trading on
Your friends have given you sound advice when
they tell you to beware of the stock market.
However they are not entirely correct that the
stock market is a gambling den. It is true that
people who have little or no knowledge of the
stock market trade in a reckless and unplanned
manner, which results in huge losses or gains.
It would certainly seem like winning or loosing
at a casino to them. If you however plan to
be an investor, make calculated choices and
have well thought out strategy you are likely
to get good returns on your investment.
You are right there is a general misconception
amongst general public that the Stock Exchanges
in Pakistan are run like closed clubs. However
let me emphasize here that his misconception
is not based on reality. After the reforms carried
out by SECP the Exchanges in Pakistan are being
run by professional managements and the brokers/members
do not and can not interfere in the running
of the Exchanges. The over all policy matters
are looked after by the Board of Directors.
The Board consists of a healthy mix of members
and SECP nominated directors. The managing director
who is an employee of the Exchange is member
of the Board by dint of his office.