Margin for Pledging

Dear Team,

If you see the attached image, this shows that my current net balance for trading account is around 35.8k. However, I have collatoral nearly 10 lacs which was pledged using liquid bees. Can I use that to carry my FO positions or should I load cash also. As I know 50% has to come from cash equivalent and liquid bees are cash related pledge, hope I can cover with 100% margin from that. Please confirm.

Hey Hi.

For your F&O overnight positions, the exchange mandates 50% of the required margin in cash or cash equivalent and the remaining 50% will be blocked from your non-cash equivalent collateral margins.

But as the exchange considers the cash component collateral margins as a cash equivalent, you can utilize your entire cash component/liquid collateral margins for your overnight carryforward trades without any interest.

Note: If you wish to buy options, or if there’s any MTM losses, those debits will be made from your actual cash. So you can maintain sufficient buffer cash.

Hope this helps.

Thanks Aswath.

You mean to sat that since I have 10 lacs as Collateral, I can take more positions and carry forward but I need to maintain cash for MTM swings and nothing else. Let me know if my understanding is correct.

Since I saw the NET after credit and Debit showing only 35k which is pure cash, I thought I cannot even take 1 more position, that is why I asked Aswath.

Your understanding is correct. You can utilize your entire Rs.10 lakhs worth of cash component collateral margins for your carryforward/intraday trades, depending on your trading strategies. :slightly_smiling_face:

And as you are aware, you can maintain sufficient cash in your account for options buying and to offset the MTM losses(if any).

In your ledger statement, the cash balance is visible, so to check your collateral margin, you can refer to your Kite funds page.

Available margin = Available Cash + Total Collateral - Used Margin.

Many thanks again Aswath.
My strategy is that I have deployed 1 lot of Nifty Nov month contract using Iron Condor which required margin of around 55k. Now I have a plan to enter into selling and buying in the future days based on my SL adjustment. How will the ledger look like, since as you said, my available cash shows around 88k but in ledger it deducts the entire margin of this strategy from cash and showing pending as 30k.Does this mean it will take the margin only from cash. Attached is the screenshot of my funds page FYR.

Yes. SPAN and Exposure will be blocked in your ledger statement, but the collateral margins won’t be shown in your ledger, you need to check from your Kite margins.

Currently, for your iron condor, the margin requirement is Rs.53,894.05(SPAN+Exposure) let’s say you have taken fresh positions and the margin requirement has been updated as Rs.1,50,000.

With reference to your Kite margins, you have Available Cash = Rs.88,551.15 and Collateral Margins = Rs.18,25,829.40.

Now, the entire Rs.1,50,000(SPAN+Exposure) will get blocked from your liquid collateral margins, so your kite margins will look like below,

Opening Balance: Rs.88,551.15
Used Margin: Rs.1,50,000
Total collateral(Liquid): Rs.18,25,829.40

Available Cash: Rs.88,551.15(The entire margins will be blocked from collateral margins, so your actual cash will be visible under available cash)

Available Margins = Rs.17,64,380.55(Available Cash + Total Collateral - Used Margin)

Your ledger statement looks like below:

Opening Balance: Rs.88,551.15
Span+Exposure: Rs.1,50,000
Closing balance:Rs.−61,448.85(Your closing balance will be in debit balance, but you can ignore the same. The collateral margins won’t be included in the ledger statement, hence the debit balance).


One of the best explanation and crystal clear to the point. Many thanks Aswath, much appreciated

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