Margin Requirement for F&O on Expiry Day

Does Zerodha block same margin for MIS & NRML trades on Expiry day?

Logically this should be same as there is no further Exposure limits required as its Expiry.

Let me know how this works on Zerodha.

This would help buy or sell more lots using the exposure margin which can be eliminated on this day.

Actually futures margin is less for near month than the far month. Not sure about options but I would guess the same is true for them as well. It’s simple more time means more risk hence more margin. But they also depend on other factors as well.

No where linked to the question I asked.

@Bhuvan, @nithin : Could you please comment on the query? So that this will help me trade this expiry?

Then why don’t you trade in MIS only on expiry day.

@siva: My problem statement is, suppose I sell a option priced 0.05 to cashin the premium. But if I use MIS, the RMS team would squareoff at market, which would be a loss for me. If I take the position using NRML, I would be cashing the premium.

As no further exposure is required further, I would recommend you block same amout for MIS and NRML on expiry day.

This is already being done with other brokers.

If you short at 5 paisa on Nifty, I believe you end up paying more than what you receive.

This is not possible as margin blocked is at portfolio level and in one portfolio there can be multiple expiries, multiple contracts and span system block accordingly.

@siva: I am not talking about Nifty. I am talking about Stock options, where lot sizes are high, where even a premium of 0.05, would give enough profit.

Now can you understand my problem?

How are the other brokerage firms managing it then? Specially similar discount brokers.

Because they are willing to take excess risk to attract clients which is not at all advisable at our scale.
One bad day is enough to wipe out the broker and all his clients if these kind of leverages are followed.
Also as I said earlier SPAN system will block at portfolio level, if multiple expiries are involved in one portfolio then this is absolutely not possible because system won’t charge less for one expiry and more for other, it charges accordingly.

@siva: The whole point here is, treating MIS and NRML trades as same on expiry day for blocking funds. There should be a technical feasibility to identify the positions for current expiry and other expiries and block the amt as reqd.

Exposure margin doesn’t logically make sense on exipry day. Broker as per NSE would already be blocking SPAN margin. How do you say they would wiped out. They are blocking funds more intelligently and logically. This would allow funds to be used more effectively if required.

1 Like

Theoretically what you are saying is right but there is no way to charge differently for different expiries on same product type as our systems are centralized and we follow unique rules/settings for all our clients.

Can i short Bank Nifty OTM call or put on weekly expiry using BO or CO ?
2. Is there same margin is given using MIS or BO/CO for shorting Banknifty option on expiry?
Please suggest there is any changes in banknifty option weekly expiry

No, not possible using BO or CO.

Yes, same margin as other days even on expiry.

Thanks Shiva for correct and quick reply

two questions :


(1) i buy TCS 300 shares in cash equity and sell 1 lot in future ; will there be any margin benefit/advantage OR both the margin would be counted separately for each of the positions ?


(2) margin used to shortsell nifty option on the expiry .
did not squareoff but let it expire at the Price 00 or 00.05 till 3.30 pm !

my question is : after 3.30 pm ; will my that used/blocked margin be freed immediately ; so that I can use that margin to trade in currency ?



No benefit.

It will be blocked, can’t use it for cds.

Suppose on expiry day I took a position blocking margin of 1lakh and after margin increased to 1.2 lakh. But would there be any penalty charges since it’s expiry .

On expiry day there won’t be any penalty for cash settled.

may I know the logic/reason pls ?
it’s expiry then why and what is the need of keeping the margin blocked ? and it is nifty and it is cash settled , then why ?