Can i trade the s&p emini futures from india without funding from ind?

#1
If I have a company in the US that is doing all of its business entirely in US, can I use profits so attained in order to trade the eminis? Am aware that its illegal to send money outside India to conduct leveraged trading of any kind because that would be in violation of FEMA rules. In my case am using funds created outside india to carry out trading and not sending any money out of india
 
#3
The first consideration should be whether you've actually been able to trade e-minis profitably on a paper-trading account or not, all else is secondary. In any case, presuming you've been able to trade them profitably for several months at the least, as far as I know, the restriction is only with regards to origin of funds, so if the money is earned abroad, then there shouldn't be any problem with it but setting up a US entity might be costly, so if you're going to do that & have enough money to risk on the US markets, then surely, you should at least consult a good lawyer or a CA or something.
 
#4
The first consideration should be whether you've actually been able to trade e-minis profitably on a paper-trading account or not, all else is secondary. In any case, presuming you've been able to trade them profitably for several months at the least, as far as I know, the restriction is only with regards to origin of funds, so if the money is earned abroad, then there shouldn't be any problem with it but setting up a US entity might be costly, so if you're going to do that & have enough money to risk on the US markets, then surely, you should at least consult a good lawyer or a CA or something.
Hi,

Do you know of any way, how a resident indian can trade forex and eminis legally staying in india and without any foreign source of funds.
 
#5
Hi,

Do you know of any way, how a resident indian can trade forex and eminis legally staying in india and without any foreign source of funds.
You can use LRS made available by RBI and transfer USD 250000 per financial year, which can be used for trading in stock market.
 
#6
Hi,

Do you know of any way, how a resident indian can trade forex and eminis legally staying in india and without any foreign source of funds.
Foreign source of funds is ok because the restriction is regarding converting INR to USD to trade leveraged/margin products abroad; so, if you have a trusted friend or a relative abroad, who has earned his money abroad & is willing to finance a trading-account for you then that should be ok but if you intend to deal in large sums of money, then it's best to consult a CA or a lawyer just to be on the safe side since regulations in India are one of the worst & most complicated.
If you don't have a foreign source of funds then I'm not sure if there's any LEGAL way to get around the RBI restriction (though MAYBE one can send money under LRS, on account of the 5th point listed under permissible capital account transactions, regarding lending money to NRI relatives under Companies Act, 2013 but again, you'd have to consult a CA or a lawyer to be absolutely sure of that).

You can use LRS made available by RBI and transfer USD 250000 per financial year, which can be used for trading in stock market.
You're right about being allowed to trade STOCKS under LRS but it is not permissible to use LRS for leveraged/margin products, like Forex & e-minis, as @trade2411 has talked about. Please cite the pertinent RBI circular if I'm mistaken.



https://rbi.org.in/Scripts/NotificationUser.aspx?Id=10192&Mode=0
6. The permissible capital account transactions by an individual under LRS are:

  1. opening of foreign currency account abroad with a bank;
  2. purchase of property abroad;
  3. making investments abroad- acquisition and holding shares of both listed and unlisted overseas company or debt instruments; 5acquisition of qualification shares of an overseas company for holding the post of Director; acquisition of shares of a foreign company towards professional services rendered or in lieu of Director’s remuneration; investment in units of Mutual Funds, Venture Capital Funds, unrated debt securities, promissory notes;
  4. setting up Wholly Owned Subsidiaries and Joint Ventures (with effect from August 05, 2013) outside India for bonafide business subject to the terms & conditions stipulated in Notification No FEMA.263/ RB-2013 dated March 5, 2013;
  5. extending loans including loans in Indian Rupees to Non-resident Indians (NRIs) who are relatives as defined in Companies Act, 20136 .

https://m.rbi.org.in/Scripts/FAQView.aspx?Id=115#Q2
Q 2. What are the prohibited items under the Scheme?

Ans. The remittance facility under the Scheme is not available for the following:

  1. Remittance for any purpose specifically prohibited under Schedule-I (like purchase of lottery tickets/sweep stakes, proscribed magazines, etc.) or any item restricted under Schedule II of Foreign Exchange Management (Current Account Transactions) Rules, 2000.
  2. Remittance from India for margins or margin calls to overseas exchanges / overseas counterparty.
  3. Remittances for purchase of FCCBs issued by Indian companies in the overseas secondary market.
  4. Remittance for trading in foreign exchange abroad.
  5. Capital account remittances, directly or indirectly, to countries identified by the Financial Action Task Force (FATF) as “non- cooperative countries and territories”, from time to time.
  6. Remittances directly or indirectly to those individuals and entities identified as posing significant risk of committing acts of terrorism as advised separately by the Reserve Bank to the banks.
 
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#7
Yes, you can operate your account form any region of the world if you have been registered on that platform. I am not hundred percent sure about it but you can consult with the officials as they can guide you properly in this regard. Best of luck!
 

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