What is the Full Form of RMS in the Share Market?
The RMS Full Form in the Share Market is a Risk Management System. This is software that offers the margin rules for the traders, to ensure that they don’t default on the payment and the delivery of their orders. The software also checks if the trader has sufficient balance in their account to perform the trade. In case the trade is leveraged, it will check for the margin amount to open a new trade position.
Features of RMS:
RMS is a set of guidelines that are laid by the software to ensure that the traders do not default in payment. It is not possible to set up RMS manually. If the trader doesn’t have enough money in his account to place a trade, the RMS will show an error. Traders can also use this tool to check how many shares they can buy before placing the order with the help of its built-in calculator.
Advantages of risk management system:
RMS ensures that the trader has enough funds before and after he has entered the trade. Also, if the trader is making huge losses in trading than the amount he has in his account, then the software stops the losses and squares off the trade. Also, the software sets the prescribed limit of leverage that a trader can enjoy by analyzing the market on a day-to-day basis.