I would like to know from option experts as to how they fulfill margin requirements during last 2 days before expiry. It is frustrating to provide margins esp for FAR OTM options during last 2 days before expiry. I hope that Nithin / others can relax this norm for FAR OTM options but until that happens, I would like to know the best way to provide for higher margin requirement.
In my case, I redeem my investment in Axis Liquid Fund (via COIN) on Monday before last expiry and then re-invest the same back into Axis Liquid Fund on Friday morning. Do we have a better way out?
1.One solution i see here is pay Interest on your margin amount, i.e 0.05% per day…
But make sure that RMS team is not squaring-off your position.
If you have same quantity stocks in your portfolio, you can call customer care and informed about your stocks. They won’t square-off your position. ( Check with Customer Support)
I agree that Zerodha is not great with margins. Today I had issues with Available Margins. It kept flip-flopping between a number closer to-3.5Lakhs and a number closer to +1.2Lakhs. I am planning to raise a support ticket asking for explanation.
However my original question still remains unanswered. What is the best way to take care of elevated margin requirements during expiry.
Please share as to what other expert do in this scenario?
keep funds in account, no other option unless you hedge positions which will incur losses on expiry day so overall your net profit will be reduced if you hedge your short index options. if it’s stock options then it’ll become complicated depending on the moneyness.
simplest way is to keep funds in your account. option selling isn’t cheap. atleast not on majority of platforms/brokers. so either manage and keep funds or short less quantity as per your funds.
I’ve opened account in alice blue just for option selling on expiry day as they gives 10x exposure whereas zerodha gives 2.5x only.