I guess F&o volumes will decrease but over the period of time people will bring the money required as well. Sebi doesn’t want retailers to trade in the derivates segment. So by this move they will force most of the retailers to move to cash market. Even their retail needs to bring atleast 3-4x of their current capital for trading.
That depends on your strategy,risk management etc, leverage has both effects, depending on leverage alone is not sustainable.
Yes, for FNO, not now but eventually.
I am using a broker who is providing 20x leverage on option selling on expiry days, so they can give only give 4x from Jan-21 and 2x from mar-21, am i right
If so then margin game will end from jan-21 itself instead of aug-21am i right @nithin
For those using 20x leverage, for them leverage is as good as over from December 2020 when reduction starts.
Hello Nithin sir
After seeing all the conversation upside
I got an view of how does from stock exchange s and retail traders going to suffer with new SEBI circular ( which is absolutely not useful for anyone)
As you can Check now a days after covid - 19 pandemic so many youth lost their jobs and they are want to start TRADING OR INVESTING in stock market to survive AND
As I know thousands of people daily opening trading and demat account In different firms
As on my view after 10 -15 years ( 2020 - 2035 ) India may have ( 15 core to 25 ) active traders and investors
At present there was only 3 million traders and investors As I know
By this decision of SEBI is it making loss of confidence of upcoming traders and new traders who want to start trading
Please look after this ask SEBI to postpone this after 10 years and sir
We are living in most democratic country in the world we have
- RIGHT TO ASK
MY WISH IS TO YOU WILL MAKE CHANGE IN BRING AN SOLUTION AND WHICH WILL HELP
FOR FUTURE INDIA ( ATMANIBHAR )
You can talking other brokerage firms and
Make a GOOD decision sir
Thanks
MMK
15 to 25 crore not possible. my guess only below 1.25 crore under
In India why can’t 10 % of population can start investing in 10-15 years It will happen bro
It will happen bro in USA 70 % population investing in stock market right now
@nithin @siva
This move will surely affect many retail traders who used to trade with 20k,30k and as low as 10k or even 5k.
It is sad to see zerodha supporting this move. you always took pride in being the broker for retail traders.
You always talk about trader blowing up the account because of leverage, but a trader who thinks trading as a shortcut or trades without any knowledge will blow up the account with or without leverage, its just a matter of time.
But on the other side there are traders who are making profits just because of margins. How will new traders learn trading now ? before this move traders were able to trade with 100-500 quantity of stock{nse50 stocks} and learn trading and were able to control their trading behaviours. after this move they will at least need 50k in their account.
Many people will never be able to start trading because of this move. I am pretty sure that no one in sebi board who took this decision traded in real life.
You want people to play game but only when they are perfect, but how will they perfect themselves if they are not allowed to play game ?
You must have analyzed your user base and must have decided that even if you lose many retail traders your pockets wont be hurt. The reason zerodha is on top is because of its UI/UX and products. You are ahead of other brokers by few years because they were busy in competing in terms of leverage and you improved your stack.
But after this move, all brokers are pretty much same and everyone has to focus on thier UI/UX.
You are ahead in terms of that, but i am sure that in no time there will be brokers who may have better UI/UX then you. Because what is stopping them to hire top level developers and make their product top level ?
Before this, i thought zerodha was a broker who was serious about retail traders. But you are just another broker who is here to make money. You are no different than the others.
Regards
Retail Trader.
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What made you think we are supporting this move? we are not against leverage but only against mad leverages like 20/30 times etc.
This move will make a dent to our revenues.
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These are my in words which I want speak with nithin sir when I get reply for my message
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And how much will be the margin released when stock are sold for transacting on the same day…?
If we sell 1 lac wortg of hdfc bank, will we be able to buy 1 lac wortg of tcs on the same day?
It is time to be positive guys. Leverage trading will surely make our account blown out one day or other. Even i trade with leverage till date. i feel it is time to learn to trade with hedge. I think the volume will rather increase because of this move, those who sold plain options will buy options to hedge and by this way their margin can be reduced , broker will be benefited more because of 2 orders instead of one, also volume will increase because of hedge. i infer zerodha will come with a spread order entry and exit soon. New traders can try several strategies with hedged positions. As their loss is minimal they can survive in the market for more time and understand that trading is all about Psychology and money management. Accept the change, to live.
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So let’s assume as of now we required 1 Lac for 1 lot of Banknifty’s Option Sell for Overnight position and as per SEBI’s recent margin rule if we hedge with another Option Buy then we should not required another 1 Lac
Total position of 2 Lac we can take in 1 Lac Rupees only, So this will be continue right or will there any change in this rule…
Hi Nithin,
What is your personal opinion on the move by SEBI? Do you welcome it or you think SEBI needs to rethink about its move?
There is no change in margin requirements for hedged positions.
True, But with the game just left to UI/UX, in which you are already ahead so it is a big win for you. since most of the user will join zerodha now because of its UI/UX.
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So my understanding is for equity segment intraday , leverage will reduce by half. For example, if it is 10x now for a particular stock, it will reduce to 5x since now exchange is allowing [50% of the VaR+ELM+Adhoc mandated by the exchange] which will become 100% in a phased manner till 2021 August.
That may not be allowed as it takes 2 days for the money to settle.
Right.