on the trading day i bought 14 shares of a company using CNC
t+2 day i recived the shares in my demat account. it shows in the quantity Q as 14.
then a couple days after i wish to sell the security as the prices were going down.
using kite browser platform i clicked on the exit button in my holdings page.
then i saw my holdings became quantity become “0” but the problem is i have opened a short position in my positions tab, is it how the process really goes through? as i am new to this kindly clarify me about this.
When shares are sold from your demat account, you have to first confirm on the Holdings page if the holdings quantity has been debited.
If it is debited, then this indicates that your holdings have been sold at your selling price.
If you are on the Positions page, you have to confirm if your Position was sold under product type CNC. If yes, then your holdings have already been sold at your selling price. You can ignore the fluctuation in the PNL on the Positions page for your Sold CNC shares as this is irrelevant to you.
As for why we allow the PNL to fluctuate in the Positions page even for CNC trades, here is why. Several traders use their Holdings value as margin to execute intraday trades. This can be achieved by selling Holdings, using the instant cash credit in the trading account to execute intraday trades and then buying the sold Holdings back before market closes. Traders keep their Holdings intact at the end of the day because there are no capital gain taxes on investments held for over a year.
Showing such CNC sell trades in positions makes it easier for traders to see the MTM profit/losses on their Holdings Sell position before they buy it back.
i do have another doubt, it would be very helpful if u clarify me regarding.
i bought 1 share for rs 1000 and it has hit my demat account. i surely know that the prices will be going up in a couple of months time.
in timely gap between the month the prices are coming down. from your answer above i came to know that i can pledge the stocks in my holdings.
now my question is if i pledge my stock and in the end of the day the price of the comes to 850 then if i buy to compensate my holdings it will be beneficial for me. Am i correct about it or wrong? can i do this type of trading under this circumstance?
Thanks a lot. an sorry for asking too lengthy questions.
Pledging is an actual process of providing your shares as security to the broker for a loan and receiving this loan amount after an applicable haircut depending on the type of security that is pledged. This margin can be used for trading equity intraday, futures and option selling.
If you mean to sell your shares from holdings in the morning as you anticipate a fall in the day and you also wish to use this credited amount for other intraday trades, then when you buy back the sold shares at the end of the day at a lower price, this will be considered as an intraday trade, the intraday profit will be credited to your account and the holdings will remain in your demat account.
If you know that a stock would eventually go up but then it is going through a minor correction in the near future, you can buy more shares as and when you see a dip in the price and this will noticably improve your Buy average price.
@albertjohn you can also attend an online demo, which will explain how the platform works. You can get all these doubts cleared up. Check this - https://zerodha.com/educate/
Demo is conducted online, so you can sit at the comfort of your house and attend this. Also, it happens twice a day, so choose a time line that suits you.
We also have a Zerodha Online channel on youtube where Kite tutorial videos have been uploaded covering a range of topics from order placement, stoploss, exiting an order, BO/CO etc.
This video on Exit Orders will be particularly helpful in your case to understand how the positions page works when different positions are taken. You will also learn about margins, placing counter orders and managing your positions page. Do check it out.
