Traders suffer losses as discount broker Shoonya faces tech glitch
时间:2024-05-18 14:37:42 阅读(143)
Zero-commission trading platform Shoonya suffered multiple technical glitches on Thursday, resulting in a host of ghost orders that left traders with losses and unable to square off their positions.
The platform is promoted by Finvasia, a fintech company founded in 2009 by ex-Wall Street professionals Sarvjeet Singh Virk and Tajinder Singh.
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The message, however, precipitated a panic among investors, who rushed to square off their positions. The customer care services were unreachable. This led the company to post another message on the social media platform late in the afternoon, asking clients not to create any new positions or clear their existing positions.
“Positions which you can see on the trading app may not be updated and correct. We will square off your positions from our end if your margin is above your available margin,” the company said.
It is not clear how many positions the company actually managed to square off on behalf of their customers. Finvasia could not be immediately reached for comment.
“It seemed to be a technical glitch which compromised their middleware and frontend. Orders were fired without any user authorisation. Nifty lot sizes were erroneous. There is a possibility the system could have been hacked as well. The company needs to issue a clarification on this,” said a broker, on condition of anonymity.
Middleware serves as a connecting link between applications, data and users.
“Question is who is going to bear this loss? It’s more then 4 hrs issue not solved. Not able to exit from my trades? How come some of the trades got executed without my knowledge. Do you want to favour some big players here My entire capital is on risk?” said a twitter user with the handle @SandhyaSri786.
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“Why my funds are in negative..? Who placed this wrong order with the wrong position size..? My 15% capital evaporated who is responsible..? Give clarity about funds & open positions,” said another user.
“Investors are gravitating towards the lowest cost provider, which does not augur well for the industry. The capex in setting up a robust trading platform doesn’t come cheap. If you are caught on the wrong foot, you need the capital to make it right,” said the person quoted above.
Investors can complain to the investor grievance cell of the exchanges to escalate the matter, said experts. Internet trading is subject to disruption, and it’s a clause that is often mentioned in the terms and conditions that customers agree with before signing up with the broker. And it may not be viable to refund losses incurred by customers.
“The recent technical glitches faced by discount brokers have highlighted the need for stricter guidelines to ensure investor protection. While these incidents are not uncommon in the industry, it is the retail traders who bear the losses,” said Deepak Singh, chief business officer at Reliance Securities.
To limit their losses, some traders who have spare capital create contra positions in other stock broking apps, but others who don’t have any capital bear huge losses, he added. “The market regulator is definitely looking to take proactive steps to develop investor-friendly guidelines to address such glitches and ensure the security of traders and their investments,” Singh said.
Finvasia offers commission free trading in stocks, bonds, exchange-traded funds and direct mutual funds. It charges zero brokerage on all intraday & delivery trades on NSE, BSE, MCX and NCDEX, with zero trading & demat account opening and AMC charges.
Finvasia Group announced the domain for its zero-commission trading app Shoonya last December.
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