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Kripa Raman

Mumbai, Nov. 13

Many retail investors who trade shares online are unable to tap the best price movements on the bourses, thanks to connectivity problems or log-in delays.

“This Monday when the market dipped in the morning I could not trade on my Web site for a whole hour till 11 a.m.,” said Mr T. Ramesh, who is a customer of ICICIDirect.com.

The same thing happened the day after SEBI’s draft proposals on P-Notes, when the markets fell 10 per cent and were shut for an hour. When the markets reopened, Mr Ramesh wanted to pick up some stocks that he felt had tanked to attractive lows, but he could not trade online for a very long time. By the time he could, the market had soared. “I lost a good opportunity.”

Ms Lalita Vaswani, who also trades on ICICIDirect.com, said it is particularly difficult to push through orders online for the first fifteen minutes of a trading day. “When I think the markets will go up, I try putting in orders at 9.55 a.m. I wait and wait, but I get a remark saying I am ‘queued’.”

Mr Mahesh Ramchandani said he long ago discontinued trading on his HDFC internet account, “One big day, I could not get through at all. After that, I just call up a local broker and place my orders.”

Connectivity has just not kept pace with online customer activity, said officials with online trading services. “One would not believe it, but the telecom pipe that connects NSE (which has the larger trading volumes among exchanges) with every brokerage was just 64 kbps in capacity. Only recently has NSE started to give 128 kbps connections,” said an official with the ICICI group.

This is apart from the connectivity problems at the customer end, he added. “But 128 kbps is only half of what the Telecom Regulatory Authority of India defines as broadband, which is a minimum capacity of 256 kbps.”

For large brokerages that place fewer but larger orders, the pipe is sufficient. “But with thousands of retail customers placing smaller orders of as little as Rs 10,000 our pipe gets clogged,” said an official with another retail brokerage.

Although NSE will offer brokerages to any number of 128 kbps pipes, it takes a lot of clever order routing to offer smooth trading, said an official with Geojit Financial Services Ltd.

NSE officials say that certain problems that ICICIDirect had at its front end are being “mutually solved”. And the problem will be fully-solved when NSE upgrades its pipes to 2 mpbs “very shortly,” one of them said.

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