Stock deals: experts for smart orders
Smart Order Routing (SOR), in which stock buyers will get the best deal by the interconnection of exchanges served by software, is the bestway forward for investors, experts at a discussion organised by the Bombay Stock Exchange said on Tuesday.
"It is the best possible decision that you can take at that point of time with SOR" said JN Gupta, executive director, Securities and Exchange Board of India (SEBI).
BSE recently introduced SOR for its members under SEBI supervision and guidelines.
"SOR allows brokers' trading engines to systematically choose the execution destination based on the factors like price, cost, speed, likelihood of execution and settlement, size, nature or any other consideration relevant to the execution of the order," said Madhu Kannan, managing director and chief executive officer, BSE.
Brokers will have to make investor aware about this concept.
"We have mandated that the broker has to tell its client what SOR is capable of, what it will do, how the order routing will happen, what are the parameters based on which the SOR will decide whether the order will go to exchange A or B," said Gupta.
SOR is well-established in all developed markets with multiple exchanges and is widely used by leading brokerage firms globally for more than a decade.
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