Any update on this? 
it had been more than 1.5 years
so as long as we have 50% cash required by exchange in our trading account that goes along with 50% collateral margin (against shares) there will not be any interest charge correct?
In other words if we dont borrow real cash from broker …there is no interest charge… …
to be more clear…when we borrow money against our shares …there will not be any interest correct?
I am planning to move a large DP holding to Zerodha and then pledge it to do intra-day trading.
Let us say I have a DP holding of 1 cr and zero cash balance in Zerodha. I pledge my DP holding to create a collateral margin of 90 lakhs (assuming 10% haricut).
Now if I use this 90 lakhs for only and only intraday F&O trades, will I be charged any interest as I do not have any cash margin? As per my understanding cash margin shortfall is calculated only at day end and since I do not carry any F&O positions overnight, there should not be any interest charges. Is my understanding correct?
According to the policies today, we only charge interest if at the end of the day, for the positions held by you, you are short on the cash component of the margin. Accordingly, for the example you’ve mentioned, no interest is levied as of today. The policy however can be changed, due notification will be shared if there are any plans to charge interest for intraday usage.
Thanks for the clarification. Will start my trading.
Charging interest on intraday would be difficult as the margin utilized will keep changing every tick due to MTM. Also, how will the time period be defined for interest calculation? It could be in minutes/seconds etc.
I haven’t anywhere said that we’re going to start charging for intraday positions, I only meant to say that the policy is subject to change if necessary. For now, there are no thoughts to levy interest of intraday positions. If,when it’s actually going to charged, the terms will be laid out.
Yes understood. Thanks.
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hey @nithin, is this feature available now? Can we pledge MFs to get additional margins for trading F&O?
We have started for liquid mutual funds for now. Others will take some more time.
Is margin against liquid mutual funds as good as cash? Will I be charged interest if margin comes from pledging liquid mutual funds?
Yes.
No.
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If my cash is 50000 and i pledge units of any liquid mutual fund of 4.5 lacs; then can I take an overnight position in NSE F&O which requires a margin of 5 lacs (and hold it for many days even the entire month)?
Do i have to pay any interest since the cash component is only 10% of the total margin required by NSE and 90% is in the form of different liquid mutual funds
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Liquidbees/liquidfunds are cash equivalent so no additional interest is charged, but you need to make good for any losses if it is future position also if margins increase after taking position as you used entire balance. I would suggest to leave at least 10% as buffer to adjust for daily m2ms and increase in margins if any.
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liquid bees is the worst liquid fund to invest in or to use as margin, because the returns are very poor, (around 4% only) which is much less than other liquid funds
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As Zerodha Charges 0.05% per day, for 1L cash margin, it costs 50 Rs per day. Per month, 1L margin, it costs 1500. Is it correct?
Is same rule applied to NIFTYBEES as well i.e. NIFTYBEES are also cash equivalent no 50% rule applicable?
How to pledge liquid mutual fund? I have purchased liquid funds through coin.
At the bottom of the spreadsheet showing the approved list of securities for pledging,
there’s a point under ‘Notes’ saying
“The benefit for the above securities are subject to the Overall limit. Member-wise limit and Liquid Asset Limit as stated in the Circular Ref. No.NSE/CMPT/19572. Dated December-13-2011.”
What does this mean? Is there some limitation regarding the amount which can be pledged? Mainly interested wrt liquid fund here.
@VenuMadhav
There is a member wise limit on how much of a particular stock can be pledged. It shouldn’t matter as we are nowhere near the limit on any scrip, including liquid funds.