Dabba trading, also known as box or bucket trading, is an illegal and unregulated practice in India where traders place bets on stock price movements without executing trades on recognised exchanges.
- Transactions are settled internally by dabba operators, who act as brokers, and are typically conducted in cash to evade taxes and regulatory oversight.
- This practice lacks investor protections and can lead to significant financial risks, including fraud and extortion by brokers.
- Dabba trading is prohibited under the Securities Contracts (Regulation) Act, 1956, with severe penalties for participants.
In Video- Ameen Pathan
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