Another SEBI rule has come up

[nithin]

@Avi_Garg

No one else has posted this, so I guess I am the first.

Someone please go through this and explain what exactly is happening. I went through it several times but couldn’t understand it completely.

There are two things to this

1. Looks like margin required to trade F&O is going to go up slightly more again.

2. I just updated my answer to this post

What does Zerodha have to say about this arbitration order and article?

This article and and whatsapp messages about an arbitration order that went against Zerodha is making rounds. Looks like there are vested interests trying to push this hard. What does Zerodha have to say about this? @nithin

There was a very old rule from SEBI which allowed brokers to either collect MTM losses the same day or the next day. Most brokers to manage risk would do it on the same day and square off positions which didn’t have enough money before market close. We recently had an arbitration order which went against us for doing so, and the client took refuge in this old rule from SEBI that said we could have waited till next day. It is practically impossible to run a broking business if we let clients hold positions overnight without sufficient margins (after the MTM losses). SEBI has now fixed this bit by saying losses have to be collected the same day.