Legal & Regulatory
Risk Disclosure Document
Investments and trading in securities are subject to market risks. Please read this document carefully before transacting in capital or derivative market segments.
Prescribed under SEBI Circulars · Version 1.0 · Status: Published
- 9 out of 10 individual traders in equity Futures and Options Segment incurred net losses.
- On an average, loss makers registered net trading loss close to ₹50,000.
- Over and above the net trading losses, loss makers expended an additional 28% of net trading losses as transaction costs.
- Those making net trading profits incurred between 15% to 50% of such profits as transaction costs.
Source: SEBI study on Analysis of Profit and Loss of Individual Traders dealing in equity F&O segment.
1. Cash Market & Equity Risks
Trading and investing in equity shares involve the risk of capital loss. Share prices fluctuate continuously based on corporate performance, macroeconomic factors, interest rates, government policies, and global market sentiment. Past performance of a security or index is no guarantee of future results.
Investors may lose part or all of their invested capital if the companies whose shares they hold experience declining revenues, legal disputes, bankruptcy, or liquidity contraction.
2. Derivatives (Futures & Options) Risks
Derivative contracts are leveraged financial instruments. While leverage allows exposure to large contract values with a fraction of initial margin, it magnifies losses as well as profits:
- Futures Contracts: You are liable for daily mark-to-market (MTM) settlements. If adverse price movement occurs, you must deposit additional margin immediately, failing which your positions may be liquidated at prevailing market prices.
- Option Buying: Buyers of call or put options risk losing the entire premium paid if the contract expires out of the money.
- Option Selling (Writing): Sellers of options face potentially unlimited financial liability in volatile markets while earning only the initial premium received.
3. Margin & Leverage Risks
When trading on margin or intraday leverage (MIS/CO):
- Unfavorable market swings can erode your account balance rapidly.
- You must monitor positions actively throughout market hours.
- Trade Grow's automated risk management systems may automatically square off open positions if minimum margin thresholds are breached or prior to exchange close (Auto Square-off).
- Auto square-off orders are placed at prevailing market rates; Trade Grow is not responsible for execution slippage during high market volatility.
4. System & Technology Risks
Electronic trading systems rely on telecommunications networks, internet service providers, cloud infrastructure, and exchange matching engines. Risks include:
- Temporary internet disruptions, latency spikes, or hardware failures at the client end.
- Exchange-side connectivity drops, order queue delays, or circuit halts.
- Unplanned maintenance or unexpected outages during market hours.
Clients are advised to have alternative communication channels (such as phone-based Call & Trade) ready in case of digital terminal failure.
5. Regulatory & Settlement Risks
Trading rules, margin peak reporting guidelines, contract specifications, and statutory tax rates (such as STT and Stamp Duty) are subject to periodic circulars issued by SEBI and the Government of India. Changes in regulatory policy or taxation can impact net returns and trading feasibility.
6. Disclaimer on Profits & Advice
Trade Grow does not promise or represent any guaranteed returns or assured returns. We do not operate advisory desks, tip services, Telegram call channels, or discretionary portfolio management. Any communication promising safe or risk-free returns in Trade Grow’s name is fraudulent and should be immediately reported to our compliance desk.