Risk disclosure

Market risk

Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.

The value of securities and derivatives moves, and it can move against you far enough and fast enough that you lose part or all of the capital you committed. There is no level of skill, software or automation at which that stops being true.

Derivatives carry a high risk of loss

Trading in equity derivatives carries a high risk of loss. SEBI studies of individual traders in the equity futures and options segment have found that a large majority of them incurred net losses. Consider carefully whether such trading is appropriate for you.

Futures and options are leveraged. A small move in the underlying can produce a large move in the value of your position, and losses on a futures or short-option position are not limited to the premium or the margin you put up. You can be called for additional margin at short notice, and your positions can be squared off by your broker if you do not meet that call.

Options lose time value as expiry approaches. On expiry day, illiquidity and rapid price movement can make it impossible to exit at any price close to the last traded one.

What automation can and cannot do

Automation removes the delay between your decision and the order, not the risk in the decision. Triggers, trailing stop losses and profit-booking rules place orders on conditions you set; they cannot protect you from gaps, circuit limits, illiquidity, a rejected order, a broker or exchange outage, or a loss of connectivity.

A trigger is a condition and an instruction. When the condition is met, Ai4Trades sends the order to your broker. Everything after that is outside our control: your broker accepts or rejects it, the exchange fills it or does not, and the price you get is the price available at that moment.

• A gap - price opening well past your level - means your stop is placed at the level you set but fills at the price the market is actually at, which can be far worse.
• A circuit limit, a trading halt or a preopen session can prevent an order from being placed or filled at all.
• Thin liquidity means a large order moves the price against itself, and partial fills leave you with a position you did not intend.
• A rejection by the broker - margin shortfall, position limit, instrument not permitted, risk-management block - stops the order regardless of your rule.
• An outage or a network failure at your broker, the exchange, your internet connection or our infrastructure can delay or prevent an order.
• A trail or profit-booking rule acts on the data it receives. Delayed, missing or restated data changes what it does.

Backtests, paper trading and past performance

Past performance and backtested or simulated results do not indicate or guarantee future returns. Paper trading results are produced without real capital at risk and will differ from live outcomes.

A backtest is a calculation over history and knows what happened next. Paper trading places no order into the market, so it never experiences slippage, rejection, queue position or the effect of its own size. Both are useful for understanding how a rule behaves. Neither is a forecast, and results from either will differ from live trading.

Costs reduce returns

Brokerage, exchange transaction charges, SEBI turnover fees, GST, stamp duty, securities transaction tax and, where applicable, depository charges are payable on your trades and are debited by your broker. Automation makes it easy to place more orders than you would by hand; more orders means more cost. Assess a strategy after costs, not before them.

Technology and access risk

Ai4Trades is software delivered over the internet and dependent on services we do not run - your broker’s systems and APIs, the exchanges, market-data feeds, cloud infrastructure and your own device and connection. Any of these can fail or be unavailable, planned or unplanned. We do not warrant uninterrupted or error-free operation.

You should therefore always be able to reach your positions by another route - your broker’s own terminal, app or call-and-trade desk - and you should know how to do that before you need to.

Your responsibility

You decide what to trade, in what size, with what stop and at what risk. Rules you configure run as configured, including when they are wrong. Review your open triggers, your positions and your margins regularly, and do not commit capital you cannot afford to lose.

If you are not sure whether a product or a strategy is appropriate for you, consult a SEBI-registered investment adviser before you trade it.