Securities Lending & Borrowing popularly known as SLB, has gained a lot of momentum in recent years.
It is a method where investors can lend the stocks in their DMAT account to borrowers for a finite duration if they do not wish to sell the same in the future.
Thus, one can earn profits by stocks bought for a long-term vision. Since the borrowers are generally short-sellers, SLB brings a win-win opportunity for both.
Vibrant Securities helps the client to make the best use of this strategy. With an experience of two decades in the field of the niche, we make it workable for everyone.
We explain features, processes, and the scope of SLB before investing so that the client understands the rules of the game.
SLB- salient features
(i) There is no counterparty risk as clearing corporations guarantee every transaction
(ii) NSE SLB platform brings more than 370 stocks
(iii) Contracts are available for a duration ranging from one month to one year
(iv) No STT and SEBI Turnover fees
Benefits to lenders
(i) Lenders have additional income from their idle portfolio. Since there is no capping on minimum quantity, everyone gets an opportunity to earn.
(ii) Lenders are entitled to dividend, bonus, and other benefits during the lending period.
(iii) Every transaction is guaranteed by a clearing corporation. Hence, there is no counterparty risk.
Benefits to borrowers
(i) Borrowers short sell the securities that are not otherwise available in the derivative segment.
(ii) In case of a shortage in delivery, borrowers can meet the obligation in SLB to avoid auction in the cash segment.
(iii) SLB bring arbitrage opportunity to the borrower when there is a price difference between cash and derivative market.
The “Vibrant Benefit”
(i) Centralized anonymous order book
(ii) Easy and fast lending and borrowing transactions of securities using the DEMAT account
(iii) The facility of quoting the lending fee per share on the interface
(iv) Early repayment and early recall of securities made simple
(v) User-friendly interface
(vi) Client support
Reap the benefit of SLB with top-notch client services offered by Vibrant Securities. Call our customer executive right now and get every piece of information about Securities Lending and Borrowing.