Leading exchange BSE will conduct mock trading sessions to test software related to trading and risk management on August 5. In three separate circulars, the exchange said it would conduct the mock trading sessions in equity, currency derivative, and equity derivative segment. The sessions will be held on August 5, according to the circulars.
“Trading members shall ensure that all user-ids approved for Algorithmic trading, irrespective of the algorithm having undergone change or not, shall participate in the mock trading session,” BSE said.
Algorithmic trading refers to high-frequency and automated execution of trades on the stock exchanges through pre-programmed software platforms installed on servers. “Market participants may note that the mock trading is merely for the purpose of testing and familiarisation and that the trades resulting from such mock trading will not attract any margin obligation or pay-in and pay-out obligation and will not create any rights and liabilities,” the exchange said.
The Securities and Exchange Board of India (Sebi) guidelines require stock exchanges to conduct mock trading on a monthly basis to test trading and risk management related systems and applications.