@VenuMadhav Let’s assume there is 1 Lakh pledged liquid fund to maintain the positions. If there is MTM loss of 10K and there is no cash in the account. will you sell only 10K or entire holding? What is the action you’re going to take at RMS? Please elaborate. Thank you.
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Holdings to the tune of debit balance will be sold.
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Dear @VenuMadhav
first ofall giving a great thanks to zerodha allowing liquid fund pledging
I have some other mutual fund also like equity ,sectorial fund also , in future we can pledge these also if yes how long its will take
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Dear @VenuMadhav, @nithin,@siva, I had pledged HDFC liquid funds on Friday and the collateral is showing up in the stock component. I raised a ticket and got a reply that liquid funds are a part of stock component and not considered as cash equivalent. In this thread, zerodha team has said that it forms a part of cash component. Kindly clarify.
Done the line. For now, liquid and overnight funds.
That’s Liquidbees (ETF), which is considered as cash equivalent, not liquid funds.
First you guys need to sit and decide what is right !
VM1 has clearly replied it will be cash component. And now you are saying completely different
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hai bhuvanesh i already pledged its cash component only . i pledged liquid fund , you are not updated z-support page
please send a circular about that , because i call backoffice and raise a ticket no one in zerodha does in have a knowledge about mutual fund pledging please release a circular
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@VenuMadhav Can you list money market funds which are allowed for pledging? Will money market funds considered as cash component?
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yes sandeep , liquid fund returns will go down now because RBI will cut rate , we need alternate source like ultra short and moneymarket
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Sorry for the confusion, Liquid funds like Liquid ETFs are considered part of the Cash component. NSE provides a list of approved securities every month, here’s the link: https://archives.nseindia.com/content/circulars/CMPT42186.zip
Yes, while money market funds do form part of the cash component, the only MFs being considered now are the ones I’ve listed above here:
So liquid funds are as good as cash right just like liquidbees?
Is this feature (liquid funds as collateral margin) really live, or is it still beta-version? It is very strange that there is no official announcement from Zerodha! Or have I missed the announcement?
The list from NSE shows large number of liquid funds, but the list sent above has only 5-6 funds.
Can Zerodha please do an official announcement and inform about all the finer details?
Yes.
It’s live.
For now, we’ve restricted it to the top 6 funds only.
Thank you. This should be a useful feature. But still, why no official announcement? 
Just to summarize my understanding,
- I buy liquid mutual funds (from the list you specified above) in COIN on day ‘T’.
- It will show up in CONSOLE on day ‘T+1’.
- I can pledge these units (with a charge of Rs 65+GST) in console and use it as collateral margin from day ‘T+2’.
- It is just like cash with 90% haircut. So even for overnight positions I can use these fully as margin.
Is my understanding correct?
Thank you again.
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@VenuMadhav
As far as I know about pledging stocks, only 50% of margin can be utilized from pledged stocks and remaing 50% of the margin needs to be cash.
Is it same for liquid funds as well?
I mean if i pledge liquid funds and i get Rs. 5,00,000/- as margin and if i trade in futures where margin required is Rs.2,00,000/-, do i need to bring in 50% of Rs.2,00,000/- (i.e. Rs.1,00,000/-) as cash or out of the Rs.5,00,000/- margin available it will block Rs.2,00,000/- and i need not bring and cash for trading in this case.
please clearify with regards to the above example.
thank you.
You’re right!
We’ll announce once the entire NSE list becomes pledge-able 
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