OTM options extra margin

F&O
42

Theoretically correct, but systems can’t handle separate logic for each individual position. It calculates based on LTP.

Due to volatility it might have increased later.

43

is this system same for every broker or just at zerodha??

44

At Zerodha we block double margins on last two days of expiry, few brokers will not allow to carry forward in last week of expiry, they will force close all positions,few may block 3 times, few may block only 1 time, it is up to the broker internal policy.

45

Thanks for clarification . But i was asking about the system of calculation at last trigger price because see i have margin of full contract value which is required to take delivery at strike price but blocking my margin more than this put me at disadvantage . Is this LTP system same for every broker?

46

I think so.

47

Hi AMit, did you get any update on this from Zerodha?

48

@siva I believe this requirement of double margin is not applicable on shorting index options ?

49

Index F&O are cash settled, so there in no requirement of additional margins during expiry.

1 Like
50

My dear wise tradingqna community members.

I just require one small clarification regarding the STOCK OPTIONS margins and penalty.

Q: If I am carrying short position in stock options (positoin size = Rs. 500,000) and today it the last tuesday of the month. From tomorrow the margin requirement from zerodha will change to Rs. 1,000,000. Will I be charged a margin shortfall penalty on Tuesday night?

51

Margin requirement will increase on Wednesday Begining of the Day, there will be no margin shortfall penalty for Tuesday night.

1 Like
52

Thank you