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Dabba Trading Software8/30/2023 However, if the nifty goes down and the investor sells the call option bought earlier for Rs. Suppose an investor buy a nifty call option with a lot of 50 at Rs.80. Let us see a dabba trading example to understand about it in a better way. Thus,bucketing involves counter party risk and action by the respective authorities as it is an illegal trade. The operator in dabba trading works on the assumption that some clients will have to bear the loss while some will make a profit. In case of bucketing, the operator bears the loss and profits. This transaction is executed outside the exchange and the operator acts as the counter party to the trade. In addition, the operator takes money from the investor for the trade. Following the order, the operator records the transaction in his book or register. However, in case of dabba trade, the investor places the order with the operator. In real trade, the investors place the order with the broker and the transaction takes place in the demat account. The bucketing acts as an operator who functions away from the crowded business areas. How Dabba Trading Works?ĭabba Trading is a process through which the broker routes the client to trade outside the stock exchange. Next, we shall learn how dabba trading works. To put it another way, bucketing is a parallel illegal stock market. In addition, the bucketing is driven by changes in the price of shares and commodities of the stock market. Dabba trading is a proxy illegal market that has its own set of rules and regulations.
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