Does the margin required include options' premium as well?

General
1

Consider the scenario where I am selling the option (NIFTY 8500CE). The margins required are shown below:
image

Now,
I will need to maintain a total margin of Rs 1,61,573 (SPAN+Margin).
But, consider I have a account balance of 1,25,000.
The premium I would be receiving will be 54, 278.
So, my total balance would be 1,79,278.
Will I be able to sell this option under my scenario?

Other way of putting my question is Can I include the premium receivable plus my account balance as well when checking for margin requirements?

1 Like
2

No, one should have full balance before placing the trade.

1 Like
3

I think premium received after taking the trade will then be deducted from total margin required. Correct

4

@siva-reddy Is @Prakhar_Agrawal’s view correct? After placing the order, will the premium I received be added to the balance so that I can use it as margins for further option purchases?

5

It will be added.