Hello, Sir; I have some MTF ETF stocks for which you stopped providing margin. I cannot sell these stocks because if I sell them, I cannot get back the margin. I have to pay daily interest; even though I know, it goes down. Please do the needful.
Why there is 10L limit on per stock
This is very less, Increase it
Because we kept that limit while taking MTF live, we will increase it soon.
Yeah, we are working on it, we will bring it soon.
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Any ETA?
Couple more weeks.
We should enable Margin Trading Facility (MTF) without any OTP like Mstock. Currently, there is no longer requirement of any OTP to buy stocks in MTF. Could you also make this seemless since CDSL site at times becomes too slow and OTP takes forever to come.
Also, please limit on each stocks/ETF is currently 10 restricted to 10 lakh each.
Nifty and Banknifty lot size itself is more than 15 lakh then keeping limit on these conservative ETF should at least be raised to at least 20 lakh and stocks can be 10 lakh. Please look into this @nithin @siva
There is no need to use any OTP now, from last Monday this new change into existence for every broker.
We have already increased the limit to 50 lakhs, per stock, last week.
@siva
include a separate MTF column in Holding page in kite - and give a option convert to delivery also -
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Already one can select only MTF as below. Conversion will be available in a week or two.
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so how would it work? there is no need of pleding at all for MTF? or i need to pledge it next day?
You just buy in MTF product type, similar to cnc, nothing else to do.
Yeah, but I still got an email from CDSL regarding approving the MTF trade yesterday. Though prior to this, my MTF trade was successful and did not need OTP.
Can you check why that happened @siva
No need of doing anything from your side, you can create ticket with that email to know the exact reason for that email.
As per CONSOLE HOME Dashboard -
Account Value = Cash Balance + Margin Blocked + Equity Holdings Value + Mutual Funds Value + Pledged Holdings + Long Option Value - Short Option Premium
The Equity Holdings Value herein does not take MTF into account? Then only this calculation makes sense. Otherwise, the account value will become much much more.
Please help me understand with this simple example -
Let’s say I have Rs. 10000 in my account. I take MTF for Rs. 2000 margin blocked and on 5x leverage get Equity MTF Holdings worth Rs. 10000. The remaining cash balance will be Rs. 8000. Assume the interest and price change of the holdings in nominal / none.
If I go by your console account value formula (truncated - non relevant fields removed) -
Option 1: Considering Equity Holdings Value is inclusive of MTF
Account Value = Cash Balance + Margin Blocked + Equity Holdings Value
= 8000 + 2000 + 10000
= 20000
Option 2: Considering Equity Holdings Value is exclusive of MTF
Account Value = Cash Balance + Margin Blocked + Equity Holdings Value
= 8000 + 2000 + 0
= 10000
Q1. So which one is it? Logically it should be Option 2. But it seems that is not the case and the Account Value shown in console will actually increase if I take MTF? I may be wrong. Please help clear it out.
Q2. Also there is no way to figure out what is the margin blocked for MTF? Is the margin blocked for MTF on current value MTM basis or based on the original Avg. Price MTF was purchased on?
Hi @abhiwin123
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Currently, the dashboard considers the MTF holding value while computing the total Account Value. So as per your example, the account value will be 8000 (cash balance after margin block) + 10000 (current value of your holdings) = Rs. 18000.
We are making changes to the dashboard fields to show MTF holdings separately and not include the funded value in the total account value computation, this will go live soon.
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The margin blocked is based on the purchase price of the stock. It depends on the Value at Risk (VAR) and the Exposure Limit Margin (ELM) for each stock. Let’s say a stock is priced at ₹100 and its margin requirement is calculated as VAR + 5x ELM (for non-F&O stocks).
- VAR: 5%
- ELM: 4%
The margin requirement would be: VAR + 5 × ELM = 5% + 5 × 4% = 5% + 20% = 25%
Thus, for a stock priced at ₹100, the margin required is ₹25. This means with ₹100 in your account, you can buy: ₹100 / ₹25 = 4 shares.
You can go through this article for more details.
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Thank you. This has been driving me crazy. I am glad I asked because via account value it was actually affecting every other segment alloc.
Anyhow, so you mean to say, in real sense, to calculate the account value I should just ignore margin blocked amount and current value of MTF holdings as well? Why margin blocked (Rs. 2000) should also be ignored for calculating true account value?
Edit: Oh! Maybe because you intend to show it separately as if it is a different account like Equity, Commodity & MTF. Which will have Margin Blocked as MTF Account Value. Is it? That will be really helpful for transparency and clarity around margin blocked.
Understood. But is this margin blocked changes on MTM basis or stays constant at the original price when the stock was purchased at Rs. 100. What will be the margin blocked if the stock moves to 110 or 90 for that matter?
No, the margin blocked will be accounted for in the total account value. We’re intending to discount only the funded value to depict the actual picture of an account. We plan to bring additional fields and tweak the logic a bit for calculating the total account value to handle MTF.
The margin blocked does not change and remains constant throughout. Zerodha collects Mark-To-Market (MTM) margins daily based on the buy price of your positions. These MTM margins are reset each day, and new MTM margins are blocked. MTM is collected only on losing positions and not on profitable ones.