Daily Current Affairs : 25-November-2023

The Investor Risk Reduction Access (IRRA) platform stands as a collaborative initiative by prominent stock exchanges in India, uniting forces from the Bombay Stock Exchange (BSE), National Stock Exchange (NSE), National Commodity and Derivatives Exchange (NCDEX), Multi Commodity Exchange (MCX), and Metropolitan Stock Exchange of India (MSE). This essay delves into the key aspects of IRRA, shedding light on its purpose, development, and operational procedures.

About IRRA:

IRRA emerges as a safety net for investors grappling with unforeseen technical glitches at the trading member’s end. This innovative platform empowers investors to swiftly close open positions and annul pending orders during disruptions, cushioning them against potential losses in the volatile world of trading.

Purpose and Scope:

The primary purpose of IRRA is to mitigate risks linked to trading interruptions, providing a crucial layer of protection for investors. Importantly, this safeguard is extended not only to traditional internet-based trading but also to transactions facilitated through wireless technology. In essence, IRRA casts a wide net, encompassing various modes of trading to ensure comprehensive risk reduction.

Availability and Stakeholders:

IRRA is not an exclusive enclave; rather, it extends its protective reach to trading members supporting internet-based trading and security trading via wireless technology. This inclusivity ensures that a broad spectrum of investors can benefit from its risk-mitigating features.

Development and Collaboration:

A testament to the collaborative spirit in the Indian financial landscape, IRRA is the outcome of joint efforts by major stock exchanges—BSE, NSE, NCDEX, MCX, and MSE. This united front underscores the shared commitment to bolstering investor confidence and safeguarding financial markets from disruptions.

Launch and Regulatory Oversight:

Launched under the auspices of the Securities and Exchange Board of India (SEBI), IRRA operates with the backing of regulatory authority. This not only instills confidence in the platform but also ensures adherence to established guidelines, fostering a secure trading environment.

Invocation Process:

During technical glitches at the trading member’s end, IRRA can be invoked by trading members across exchanges, encompassing both primary and disaster recovery sites. Moreover, stock exchanges possess the autonomy to initiate IRRA suo moto, further fortifying the platform’s responsiveness to potential disruptions.

Important Points:
  • About IRRA:
    • Acts as a safety net for investors during technical glitches at a trading member’s end.
    • Empowers investors to close open positions and cancel pending orders during disruptions.
  • Purpose and Scope:
    • Mitigates risks associated with trading interruptions.
    • Available for both internet-based and wireless technology-supported trading.
  • Availability and Stakeholders:
    • Accessible to trading members supporting internet-based and wireless technology trading.
    • Ensures inclusivity for a broad spectrum of investors.
  • Development and Collaboration:
    • Jointly developed by major stock exchanges in India (BSE, NSE, NCDEX, MCX, MSE).
    • Reflects a collaborative effort to enhance investor confidence and market stability.
  • Launch and Regulatory Oversight:
    • Launched by the Securities and Exchange Board of India (SEBI).
    • Operates with regulatory authority, ensuring adherence to established guidelines.
  • Invocation Process:
    • Trading members can invoke IRRA during technical glitches at their end.
    • Applicable across exchanges, including primary and disaster recovery sites.
    • Stock exchanges can initiate IRRA suo moto, enhancing responsiveness to disruptions.
Why In News

The Investor Risk Reduction Access (IRRA) platform, a collaborative effort among major stock exchanges in India such as BSE, NSE, NCDEX, MCX, and MSE, aims to enhance investor confidence and provide a seamless experience in navigating the dynamic financial landscape.

MCQs about IRRA

  1. What is the primary purpose of the Investor Risk Reduction Access (IRRA) platform?
    A. Facilitating wireless technology trading
    B. Enhancing regulatory oversight
    C. Mitigating risks during trading interruptions
    D. Initiating primary site invocations
    Correct Answer: C. Mitigating risks during trading interruptions
    Explanation: The IRRA platform serves to mitigate risks associated with trading interruptions, providing a safety net for investors during technical glitches at a trading member’s end.
  2. Which major stock exchanges collaborated in the development of the IRRA platform?
    A. BSE and NSE
    B. NYSE and LSE
    C. BSE, NSE, NCDEX, MCX, and MSE
    D. NASDAQ and CME
    Correct Answer: C. BSE, NSE, NCDEX, MCX, and MSE
    Explanation: The IRRA platform is the result of joint efforts by major Indian stock exchanges, including BSE, NSE, NCDEX, MCX, and MSE.
  3. Who launched the Investor Risk Reduction Access (IRRA) platform?
    A. Bombay Stock Exchange (BSE)
    B. Securities and Exchange Board of India (SEBI)
    C. National Stock Exchange (NSE)
    D. Multi Commodity Exchange (MCX)
    Correct Answer: B. Securities and Exchange Board of India (SEBI)
    Explanation: IRRA was launched by the Securities and Exchange Board of India (SEBI).
  4. When can the IRRA platform be invoked by trading members?
    A. Only during market closure
    B. During technical glitches at their end and across exchanges
    C. Only during regular trading hours
    D. Exclusively by the National Stock Exchange (NSE)
    Correct Answer: B. During technical glitches at their end and across exchanges
    Explanation: Trading members can invoke IRRA during technical glitches at their end across exchanges, encompassing both primary and disaster recovery sites.

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