India Intra-Day Shorting Risk Disclosure

Trading in India is restricted to Indian Residents.


Interactive Brokers currently offers the ability to sell short certain stocks listed on Indian stock exchanges on an intra-day basis before having the shares in deliverable form. In accordance with IB’s stock selling rules, traders are required to deliver shares sold or close short stock positions prior to the end of the trading session.

Should traders establish a short stock position intra-day and still hold the position ten minutes prior to the end of the trading session at 15:20 IST, Interactive Brokers may close the position on your behalf, on a best efforts basis. If any short position is not closed by the end of day and the shares are not available for delivery by the customer on the regular settlement, the account will be deemed to be in default of its settlement obligations and the deficient positions will be subject to a forced buy-in in an exchange mediated auction market. Please note that the prices in the auction market are highly variable and forced buy-ins may be at substantially inferior prices to the regular continuously traded market.

Please note that outstanding open orders to close positions entered by the customer may not be considered should IB be required to close a short position prior to the end of the trading session in which it was established. Accordingly, customers may have duplicate stock repurchase/purchase transactions in the event that both IB initiated and the customer initiated orders execute. IB will not be responsible for such duplicate purchase situations.

In the event a short selling transaction is not covered by the end of the trading session in which it was initiated, and a consequent forced buy-in via an exchange auction is required, IB will charge INR 1,500 for the manual processing of these transactions, as well as apply any third party costs or penalties. We strongly urge customers to monitor their positions and take appropriate actions themselves in order to avoid this.