Lots of people, who aren’t regular traders and trade on and off during free time, aren’t fully aware of all the new regulations. It’s not about being unwise, it’s about them being uninformed.
I like that Nudge warns users that selling certain stocks before T+2 can incur penalty if you don’t have sufficient additional margins. I’ve been trading and investing for nearly 15 years on and off, and wasn’t aware of this ad-hoc margin regulation until Nudge warned me. Something similar on Nudge for margin utilization will help, especially for newbie traders.
Specifically in this case, why can’t traders utilize a little less funds to account for intraday & post-market margin changes? I myself take overnight positions everyday and keep around 4L for any margin increase (4L because I haven’t seen any increase beyond that in my case, might be different for others depending on their trades), but if Zerodha asks to keep something like 10% extra, then I would easily be losing out more keeping this extra sum as idle. I’d rather take that 0.01 % chance of getting the penalty.
If newbies don’t know the exact rules, then why should the people who know that & follow it in a disciplined way be penalised? It’s like you make an effort to go to a meeting on time, but it gets delayed because one or two people can’t come on time…so basically, you’re the idiot for doing things the right way…
@Jason_Castelino - This is exactly the main point why I started this thread. Please check out the 1st post in the thread. According to me Zerodha already prescribe higher haircut vs the stipulated (by NSE) and still we are paying peak margin penalty for even negative balance of 1 INR. Zerodha never clarified me on this point. This Zerodha’s margin calculation is a big black box to me.
From whatever response I have got from zerodha so far, penalty is not calculated by zerodha. The exchange sends them a file clientwise with penalty calculation. They just blindly pay the demanded amount and charge the same to our account.
If this is true, then we would have already received the benefit of full margin.
Yes, exactly but in Zerodha we don’t receive benefit of full margin. I am still not convinced by Zerodha’s explaination.
As far as I know exchange take snapshot of account (randomly selected) 4 times a day and if that random selected account has negative balance then exchange imposes margin penalty. But again question is what’s the real margin limit? Who decides if the account has debit balance - Zerodha or echange because both of them offers different margin limit? I think Zerodha should show some concrete evidence on margin penalty charged on us rather than just stating something as it’s not possible to verify their stated fact.
As a precaution, keep tracking your MTM profit and loss to try to figure out extent of increase in used margin. Whenever market moves violently in your favor, free unutilized cash will increase and vice versa.
For an option seller, if underlying index/stock on sold options moves 2% , there might be an increase of 4-5 % in used margin (depending on how far OTM sold options are) when the move is against you.
Yeah I know that. But here am talking about 20 percent increase in margin. I kept 25lakhs which was around 11percent of my funds utilised. It went to negative 21lakhs. So overall margin increased by 20 percent.
Update on this. At 8AM today. Margin was negative 7lakhs. Now tell me what changed from 5PM to mext day 8AM.
I do this too. And loss was only around 3lakhs. So still doesnt make sense.
Index moved around 2 percent yesterday last 1 hour. Lets say margin increased by 10 percent, even then it doesnt make sense. For me margin increased 20 percent.
Can you tell me in terms of percentage of funds utilised please?
I have not read all the above posts so i apologize if you already know but this is common. When mkt closes, the MTM in Positions TAB will be calculated based on LTP but in contract note it will be the adjusted close from EXCH. Usually this is very small and hardly differs but yesterday it was pretty huge.
Example:
So yest the BNF-APR had LTP of 36093 and MTM position was X but the closing rate calculated in Contract NOTE is 36403 (19-APR-note).
So for that long position itself there is 300pt diff per lot and for long position a bit better EoD mtm as compared to mkt closing LTP.
The closing MTM was deeper than what was next day before mkt open as well.
I am sure the closing prices are what changed b/w 5PM and next day. Im still not sure the full effect unless u post exact positions but it has to be somewhat like this.
I know this too. MTM loss in postion tab was 6lakhs. Today morning it was 3 lakhs. So I understand if there is 3 lakhs differnce.
But the margin was negative 21lakhs yesterday and negative 7lakhs today morning. The difference is 14lakhs. Anyways let me wait for penalty to be charged. Let me see on which value it will be charged.
Also. I didnt have any stock pledged. Otherwise I know value of collateral also reduces. So thats ruled out too.
I dont think it is relevant. I have given all values in terms of percentage. My only question was how did margin increase by 20 percent just like that. Plus I even mentioned that I am not sure if zerodha margin calculation is wrong. May be this is how it works. But I have seen many times margin keeps changing when nothing changes.
Example. Few days back I refreshed funds tab. It showed 22lakhs margin available. I refreshed again. It showed 9lakhs. Refreshed again. 21lakhs again. I did it at least 10 times and it kept changing to these two values. And it was refreshed every second. This made me feel that there is a bug in margin calculations.
Having said all of this, I know there is a possibility that I am missing something and I am wrong.
This particular thing is a bug in Zerodha’s system.
When margin is getting updated intraday, for a minute or two, the margin available keeps changing between the two values. Like if around 11 am, margin available is 5L, and the new margin available is supposed to be say 10L, then at the time of updation (around 11:35 or so), it’ll keep getting changed between 5 & 10 when you refresh it.
I first noticed this few months back, thought of creating a ticket, but then left it as it’d be too difficult to explain, plus these guys don’t like to believe their system has flaws anyway…
This looks like a browser caching issue at your system’s end and has nothing to do with margin calculation at Zerodha’s end. Your browser based on the response time of your internet can choose to display margin from local cache or make a fresh request via network to fetch latest data. To avoid this - completely disable cache on your browser especially for sites like zerodha kite / console / etc, where you seek realtime data.
I see. If it is a mobile app - that is a zerodha controlled environment.
The data under Funds section and many console links therein - open up in a controlled flutter web for which it might be possible for them to manage cache at application level. Otherwise, if it is an API call to get margin data - there might be some caching issue at Cloudflare’s end. And it is quite possible that this is just intermittent issue when cloudflare might be re-routing traffic to different region - and you are caught in the transition.
Either way, it seems to be a caching issue wherein you are not having latest information at all times. It is very hard to debug and reproduce. So you should definitely record a video of the issue in action (if you see it happening again) and raise a ticket.
but this is common. When mkt closes, the MTM in Positions TAB will be calculated based on LTP but in contract note it will be the adjusted close from EXCH. Usually this is very small and hardly differs but yesterday it was pretty huge.