How does the latest SEBI circular about margin requirements affect me?

[p699]

@nithin I will pay the “margin shortfall penalty” but please dont square off my positions.

[ArsenSimao]

what happens to those who buy call and put options
do they have to maintain the margin requirements as per sebi
can someone enlighten me, may be Nitin himself and that would be great
thanks

[nithin]

@vivek_manot

Thus this effect indraday margin by any means?

No, will not. Atleast at Zerodha.

Other brokers might face some pressure offering that additional intraday leverage on F&O.

[nithin]

@RahulN

Starting tomorrow, you have to maintain full margin, i.e., SPAN + Exposure, to carry forward F&O positions. Not maintaining adequate funds could result in a system square off or an exchange margin penalty. Read more here.

So before this how much we had to maintain?

Before penalty was applicable only if margin went below SPAN.

[nithin]

@p699

@nithin I will pay the “margin shortfall penalty” but please dont square off my positions.

If you have been trading with us, I don’t think life will really change much for you.

[nithin]

@ArsenSimao

what happens to those who buy call and put options

do they have to maintain the margin requirements as per sebi

can someone enlighten me, may be Nitin himself and that would be great

thanks

When you buy options, you pay the entire premium using money in your account. There is no concept of margin. Nothing changes for buy option clients.

[TIMEFRAME]

Margin requirements does not affect call and put option buyers , it affects option sellers , stocks & Index Future buyers & sellers , Its better to buy "Stock options ( put & call )which are not in Physical settlement list "

[p699]

5% of shortfall. Not total amount.

[yogi.agni]

@nithin

cash + collateral

What is Collateral? Do you mean F&O trade?

[Som_E]

Collateral. Means share a that u pledge for margin instead of cash.

[siva]

@yogi.agni

What is Collateral

Margin benefit one will be getting by pledging stock, can see more here.

[siva]

@Vagaram_Chowdhary

Zerodha would be charging penalty of 5% if the account balance went below span+exposure margin?

Penalty charged by exchange, Zerodha will just pass it, and penalty is on shortfall amount only.

@Vagaram_Chowdhary

Is it also the case even if zerodha squared off the positions?

If position is squared off, then no penalty.

[ArsenSimao]

Thankc

[ArsenSimao]

Thanks

[Som_E]

SEBI postpones regulation directing brokers to collect an upfront exposure margin from clients. https://t.co/lnhei3eiHX

[siva]

@Som_E

SEBI postpones regulation directing brokers to collect an upfront exposure margin from clients.

Yes, applicable from july 2nd.

[nithin]

@siva

Yes, applicable from july 2nd.

https://www.nseindia.com/content/circulars/CMPT37887.pdf

[p699]

@Som_E

SEBI postpones regulation directing brokers to collect an upfront exposure margin from clients.

THANKS SEBI

[Rahul_Sharma1]

HI @nithin When Zerodha is allow Collateral from Mutual Funds.
We are waiting from 2016 for this answer

[nithin]

@Rahul_Sharma1

HI @nithin When Zerodha is allow Collateral from Mutual Funds.

We are waiting from 2016 for this answer

Mutual funds are a little tricky, especially with funds which have regular dividends (we get the dividend, which has to be passed to you, accounting is a pain), dividend in terms of new units, funds with lock in, etc… We will do it, but this will maybe take more time.