Shortages Handling

On the settlement day NSE Clearing accepts pay-in of securities made by members through depositories and identifies the shortages. The members are debited by an amount equivalent to the securities not delivered and valued at a valuation price. This is known as valuation debit. For all such short deliveries NSE Clearing conducts a buying-in auction on the T+2 day, after completion of the pay-out, through the NSE trading system.

If the buy-in auction price is more than the valuation price, the CM is required to make good the difference. All shortages not bought-in are deemed closed out.

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Valuation Prices

Close-out Procedures

Funds Shortages

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The higher the Percent of Deliverable Quantity to Traded Quantity the better - it indicates that most buyers are expecting the price of the share to go up.

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