If I square off my existing short positions today , Will my margin gets free immediately and Can I use that margin to create new short positions ?
I am confused as on Zerodha support pages margin settlement in T+1 but many option sellers create new positions immediately after squaring off their existing short positions using the same margin without any penalty.
Can anyone from zerodha please clear this doubt as I contacted zerodha support but they did not provide any clear information
Yes, you can use margin freed from squaring-off of your Short Position to take fresh short positions.
But if you have sold any stock or squared-off Long Options Position then you can’t use those funds to take fresh Overnight Short Positions, this is result in margin shortfall.
Ok Sir, so Margin shortfall is applicable only from funds received from long option positions. Thank you for explanation.
Funds received from sale of stocks, square-off of long Options positions and profits, as this are unsettled funds, using this to take overnight positions in F&O will result in margin shortfall.