@nithin - what’s the reason behind higher mtf rates here in Zerodha which is even more than Zerodha Capitals LAS rates. The interest arbitrage is enormous between the rates offered by few other prominent brokers on MTF and Zerodha’s rate.
Even though Zerodha might offer better trade infra and support but if some were to use large sums and utilise borrowed (mtf) money, difference is considerable.
Quoting from our post.
Leveraged trades also bring a lot of risk to the broker. If the cost of funds is 9.5% to 10%, we have to charge over and above this to compensate for the risk associated with the trade.
MTF has a higher interest rate than LAS (loan against security) provided by our NBFC Zerodha Capital at 11% because the margin provided is much lesser for LAS, and hence, the trade carries significantly less risk. For LAS, the haircut or loan provided against security as mandated by RBI is a 50% minimum hence less risk, For MTF, it is up to 20%.
And the loan taken against a security (LAS) is not supposed to be put back in the stock markets.
Guess we are one of the lowest across brokers, I know few are offering slabs but if we consider across rates and other charges we outweigh many or even everyone.
hi, many names when i enter will be in MTF list so buy with leverage. but later after few days it goes out of MTF list. Then we cannot take new positions in MTF in that name, or we can but with 100% margin.
What happens to existing positions? Do i continue to get leverage benefit in that or that is also converted to 100% margin?
Lets say i entered Garuda construction few days back 1 lakh position in MTF, margin required was 30% only, so 30k required. now its out of MTF, or rather margin required is 100%. so for new positions of 1 lakh it requires entire 1 lakh margin, what happens to older positions? does it continue to run with margin of 30k or u take the extra margin of 70k for older positions also??
also in MTF holdings page, can we get script level funded value
No change in margin for older positions.
thank you. is it possible to include script level margin % or number value for each holding in the MTF holdings page??
We’re working on adding this.
@siva @TheGouda @Ragavendran_M bought nestleind stock on MTF sold after bonus declare. Today Nestleind bonus share got credited to account but not showing in MTF. I want to convert nestleind stock to CNC? How much time it take to show on MTF holding
Hi @siva, any update on allowing pledged margin to be used for MTF? Has been a couple months since the last update
This will take more time, maybe by end of this year.
still waiting for this. another 45 days have passed since
This is WIP, should be live in a few weeks.