The move should encourage them to participate in the first ever platform for individuals, who are willing to invest in sovereign bonds directly without mutual fund plans. This in turn, will help in the market making as primary dealers are billed as key players to support retail investments.
“A special Switch window will be opened for PDs every month, wherein PDs may switch the illiquid/semi-liquid securities acquired through RFQ (Request for Quotes) segment from RDG (Retail Direct Gilt) account holders with liquid securities from RBI at FBIL/market prices,” the central bank said in a notification.
PDs, who help sell government bonds in the primary market can include those successful trades in the annual targets for which they earn some fees.
“All successful trades under the Retail Direct scheme will be reckoned towards fulfilling the annual target for turnover with mid-segment and retail investors prescribed to each PD respectively,” RBI said.
The central bank also asked PDs to submit periodical reports on successful trades executed under Retail Direct.
The Reserve offered a dedicated window for bond houses, known as primary dealers (PDs), through which they can exchange illiquid securities acquired through the Retail Direct platform with liquid papers.
The move should encourage them to participate in the first ever platform for individuals, who are willing to invest in sovereign bonds directly without mutual fund plans. This in turn, will help in the market making as primary dealers are billed as key players to support retail investments.
“A special Switch window will be opened for PDs every month, wherein PDs may switch the illiquid/semi-liquid securities acquired through RFQ (Request for Quotes) segment from RDG (Retail Direct Gilt) account holders with liquid securities from RBI at FBIL/market prices,” the central bank said in a notification.
PDs, who help sell government bonds in the primary market can include those successful trades in the annual targets for which they earn some fees.
“All successful trades under the Retail Direct scheme will be reckoned towards fulfilling the annual target for turnover with mid-segment and retail investors prescribed to each PD respectively,” RBI said.
The central bank also asked PDs to submit periodical reports on successful trades executed under Retail Direct.
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