The National Stock Exchange's move to levy system abuse charges in the Futures & Options segment from next month would help small investors,curb artificial jacking up of stock prices and improve efficiency of the system,analysts said. The NSE has levied the charges for the first time to prevent system abuse through placing of very large number of unproductive orders which mostly do not result into trades. "The proposal to levy system abuse charges would help to discover the real price of the stock and in curbing artificial jack up of prices in the F&O segment. It will benefit retail investors as they would not be mislead," brokerage firm SMC Global Vice President Rajesh Jain said. The NSE circular said,"in order to prevent such system abuse and to ensure fair usage of the system by all members,it has been decided to levy a charge to deter system abuse in he F&O segment with effect from October 1,2009." The charge will be one paise per order for daily rder-trade ratio of more than 100 and up to 250. The charges would gradually increase up to four paise for order-trade ratio of more than 1000. Bonanza Portfolio Assistant Vice President Avinash Gupta said,"levy of abuse charges will help in improving efficiency of system as unnecessary load from unproductive orders would be reduced,give a better quality of trade and speed up the trade information dissemination process."
