SEBON Approves Margin Trading: Investors Can Now Buy Stocks With Broker Loans
Mon, Mar 30, 2026 12:14 PM on Highlight News, Stock Market, National,
The Securities Board of Nepal (SEBON) has officially authorized margin trading, allowing investors to purchase stocks by paying only a portion of the total cost upfront. Under these new guidelines, an investor must provide at least 30% of the investment as a down payment, while the stockbroker provides the remaining amount as a loan. To ensure safety, investors are required to maintain a minimum balance of 20% of the investment's value in their account. If the stock price falls and this balance drops below the limit, the broker will issue a "margin call," requesting more funds. If the account value further declines to 15%, the broker has the authority to sell the shares to recover the loan.
This facility is not available for all companies; it is restricted to stable firms that have been listed on the exchange for at least two years and have shown a profit in two of the last three years. Additionally, eligible companies must have at least 2.5 million shares available to the general public. To provide this service, brokerage firms must have a minimum capital of Rs. 20 Crore and obtain specific permission from both the Nepal Stock Exchange (NEPSE) and Nepal Rastra Bank. This move is expected to increase market activity by providing investors with more buying power, though it also comes with the risk of quicker losses if stock prices fall.
