As you are aware, Indian Stock Markets are at its all time highs. We have seen a sharp correction over the last few sessions attributing to various factors such as earnings degrowth and margin pressures in select heavyweight stocks, rising bond yields in US, China’s GDP contracting to touching multi decadal lows and also the ongoing geopolitical tensions in the Middle East & Ukraine. Along with the interim budget coming up and elections held in India as well as the US, we expect the market volatility to go up or continue for a while in the near future.
At Dhan, we’ve noticed a substantial upswing in total trades per user and a substantial increase in overall trading & investing behaviour, mirroring the trends in the broader indices as they have made new highs. To add to that, historically it has been observed that higher leverages lead to more trades in the markets, many times prior to sharp corrections, resulting in traders losing money when the market turns adverse.
Considering all of the above factors, we feel enabling more leverage is not going to be in the best interest of our users. Thus, after a long and careful deliberation, as a prudent risk management measure, we have taken a call to temporarily pause fresh buying in MTF with immediate effect. While we acknowledge that this decision may pose some short-term inconvenience for all of our users who have been thoroughly enjoying the MTF experience, we always believe in safeguarding the long-term interests of our users at Dhan.
Please be assured that we continue to watch the markets closely, and will bring MTF back the moment volatility seems to have settled and we feel comfortable with reintroducing MTF to our clients. In case you already hold MTF positions with us, you can continue to hold the same or square those off without any hassle from your Dhan App or Web.
As markets continue to be near all time highs along with highly volatile movements in trading sessions, we advise all our clients to be mindful and practice caution in all forms of trading, and specially in options trading. We hope for your understanding regarding the rationale behind this decision and request your continued support.
As a team, all of us at Dhan continue to build and ship an incredible investing & trading experience for you in the coming year. We are excited about 2024 and have made our roadmap for this year available for all.