Shortages Handling

Settlement Shortage

Failure of a Clearing Member to discharge its obligation in full or in part to deliver funds at the time of settlement shall be treated as a settlement shortage. Clearing Corporation shall have the absolute discretion to decide on the mode of handling shortages and the decision of Clearing Corporation shall be binding on all the Clearing Members;

 

Handling of Shortage

Clearing Corporation shall initiate all measures that are prudent, practicable and necessary to meet the funds shortage in order to ensure that the repo deals are settled and all the non-defaulting Clearing Members receive funds due to them; Clearing Corporation shall at its discretion conduct Auction or close out the position in case if auction is not successful. Clearing Member who failed to discharge the settlement obligation shall be liable to pay charges, penalty (as applicable for Debt segment) or any interest arising out of making such shortages good to the Clearing Corporation.

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The higher the Percent of Deliverable Quantity to Traded Quantity the better - it indicates that most buyers are expecting the price of the share to go up.

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