I read one of the 60-day challenge winners, Madan, talk about wanting to put his cash in LiquidBEES and then use that as collateral to trade in futures.
I am also interested in knowing what that is about. Can I buy LiquidBEES for 75% of my funds and still use that value to buy/sell Nifty futures?
If yes, what if I buy Liquid Bees for my whole portfolio, how will my MTM losses be calculated? Will shares of the LiquidBees sold the next day to makeup for the losses?
Please recommend the best way to make use of this feature. My aim is to make a decent interest return for the funds in my account. Suggest the best option to go about making a decent interest return.
And I guess I’d also have to have a Demat account. I have only a Trading Account now.
Yes Arun, you can buy liquid bees and once in your demat pledge that to get margins that can be used for F&O trading. To pledge with us, you just have to send an email asking to do so once the account is opened. It costs around Rs 60/scrip to pledge.
Yes you will need to open a demat account with us for doing this.
It is best that you keep atleast around 25% in cash in your trading account to make good of any MTM losses, otherwise we would be forced to squared off the pledged bees.
Also the charges is rs 60 only or + any charges by IL&FS it says 0.02% of the transaction charges for each step Pledge Creation, Pledge Creation confirmation, Pledge Closure, Pledge Closure confirmation and 0.05% Pledge Invocation. That is .08 paise for the round trip?
Thanks for the answer Nithin.
Just a few more questions.
How is the cost calculated? For example, I want to pledge Bees worth 2.5 lkhs. What will be the charges?
And some general questions - How much do the Bees return per year? Is the interest paid out monthly or yearly? And are they liquid and safe? I have read a bit about them. But I want to know more before I buy them. And also do a lot of Futures traders use this method? If no, why don’t they? What are the disadvantages/
Charges is just one time Rs 60, irrespective on the value of bees that you pledge. Bees return between 5 to 9% based on market conditions. They are very liquid and safe, check this link:http://tradingqna.com/533/what-are-liquid-bees and one of the reasons this is not very popular is because the trader will constantly need to ensure that there is enough liquidity to meet the MTM requirements.
Thanks for the reply again.
What about the interest payments? When do I receive them? Monthly?
And I guess I can buy and pledge NiftyBeeS also in a similar manner, no?