How to Invest

Exposure Limits:

The KSE has an effective var based Risk Management System under the regulation governing Risk Management of Exchange. As a part of risk management, KSE has devised circuit breakers as under.

T+2:

There shall be a circuit breaker in case of price fluctuation 5% or Rs. 1.00, whichever is higher, from the closing price of the previous day. Accordingly trading will be restricted within upper and lower limits of 5% or Re. 1.00 whichever is higher from last closing price.:

Futures Contract:

There shall be a circuit breaker in case of price fluctuation 5% or Rs. 1.00, whichever is higher, from the closing price of the previous day. No trade in the Futures Contract market will be allowed beyond the above price fluctuation In order to strengthen the Risk Management, the amount of Net Capital Balance has been enhanced to Rs.2.5 million under the Capital Adequacy Ratio the members are allowed to trade up to 25 times of the Net Capital balance.

Clearing House Protection Fund:

In order to ensure smooth settlement, the KSE has established a Clearing House Protection Fund. In case of default of a member, shortfall, if any, is fed through this fund up to a certain limit as approved by the Board from time to time. The contribution to the Fund is made by the members of the Exchange.

Investors Protection Fund:

An Investors Protection Fund has also been established to protect small investors from the consequences of a member's default. The fund is operated under a set of Regulations.

Market Surveillance:

The advent of the Automated Trading System has enhanced the market surveillance capability of KSE to devise a market control system. An independent Market Control and Surveillance department has been established to monitor price fluctuation and trading patterns to ensure compliance with regulations and detection of speculative activities.

Minority Shareholder's Interest:

The Exchange has played a proactive role in safeguarding small shareholders' interest and has strengthened its monitoring and enforcement capability to ensure corporate governance. During past couple of years a number of cases have been referred to the SECP in this regard.