Investor Guide>>Trading                                                                                                     Back to Investor Guide Main

- Agreement with constituents                                                                                                                    Back to top
Choose the broker you want to trade with and enter into a broker-client agreement. You should carefully read the various terms and conditions and understand their implications before entering into an agreement with a member/broker. This agreement is mandatory. The features of this agreement which reduce the chances of any dispute are terms and conditions which relate to order or trade confirmation, brokerage charged by a broker and delivery of securities and funds.

- What precautions are to be taken in signing a broker-client agreement?                                       Back to top

• Check whether the name of both parties have been mentioned in the agreement

• Check whether both the parties or their representatives have signed on all the pages of the agreement. Also check that the witness of both the parties have signed and put their names against their signature.

• Check whether the Trading member's representative have the authority to sign the agreement.

- How do I execute an order on the ISE?                                                                                                     Back to top
Place orders with the broker preferably in writing. Orders over the telephone/fax are also acceptable. Ask for the order confirmation slip on the day the order is placed. Ask for trade confirmation slip on the day the trade is executes. Ensure smooth settlement of the trade by delivering securities and/or funds time to your broker.

- Does the ISECTS give lower priority to small orders as against big orders?                                  Back to top
In fact you will be surprised to know that the ISECTS treats all quantities alike. For example if you have placed a buy order for 5000 shares of company `A' @ Rs. 20/- per share ahead of another investor who has placed buy order for 10,000 shares of company `A' @ Rs. 19/- then your order will get priority over the big order.

- How does one ascertain the correct rate at which transactions have taken place?                      Back to top
Brokers are obligated to give their clients a trade confirmation slip the moment a trade takes place. This slip carries the rate at which the trade takes place. At the end of the day the broker has to issue a computer generated statement which separately shows the rate at which the trades take place along with the brokerage rate.
It will be the responsibility of the investor to collect the purchase/sale confirmation contract from the broker's office within 2 working days of the date of execution and account ledger report within 3 working days after the last trading day of the week.

- How do I know my broker is giving me the best price?                                                                       Back to top
The ISECTS matches orders in such a way that the order is executed at the best possible price available on the system. This is because the process of matching buy and sell order is done by the computer.
After all this if I still have a problem regarding the prices, deliveries or any thing pertaining to my trade, is there somebody I can approach?
The Exchange has a Complaint Cell where you could call in case you need any clarification. Further in case of disputes between brokers and clients, there is Floor Committee which is precisely the Forum for amicable settlement of dispute. Nevertheless, if a dispute is not resolved amicably, there is a procedure for arbitration.
In the event of any dispute relating to the trade all you have to do is to file your complaints to the Floor Committee of the Exchange.

- What are the documents you should receive from your broker and when?                                   Back to top

i) Order confirmation slip or Trading Statement. After the order has been placed.
ii) Trading confirmation slip. After the trade has been executed.

- What are the points to be checked by an investor to check the validity of documents?               Back to top
Name and address of trading member, their ISE registration number, detail of trades like order number, trade number, trade time, scrip, rate, brokerage, settlement date and signature of authorized signatory.

- What is financing and how it is different from normal stock exchange transaction/trade and whether it is legal under stock exchange regulations?                                                                                              Back to top
Financing is referred to as a transaction whereby an investor invests money with the broker for a periodic fixed return.
It is different from the normal stock exchange transaction/trade on two counts:

  1. The money is not given for investment in shares.
  2. It guarantees fixed return (where as the exchange transactions does not guarantee any such fixed return)

Financing is not allowed under the regulations of the Islamabad Stock Exchange. Investors are therefore cautioned not to enter into transaction involving financing.