Is it by pledging? I read it in this article (last paragraph).
You will have to pledge the Liquid Mutual Fund’s you are holding, after pledging you will recieve collateral margin which can be used for trading Futures and Shorting Options.
The margin you receive cannot be used for buying Options, for that you will need cash.
You can read this post to know the process of pledging.
If you are new to Options trading, would suggest you read this module on Varsity;
And I will continue to get my return in that fund even after pledging, correct?
Right, you will continue to earn returns even after pledging.