Continuing the discussion from Peak margin, Intraday leverages, & 2nd order effects - Dec 1st 2020:
The price of the long options is barely rs 600 or so so it should not impact the value by too much.
So this also seems like a case where the leverage on the hedged position is lower. I.e margin benefits not accounted for.
Continuing the discussion from Peak margin, Intraday leverages, & 2nd order effects - Dec 1st 2020:
IF I PLEDGE MY EQUITY SHARES THE MARGIN RELEASED COULD BE USED FOR PURCHASING SHARES WHICH ARE THERE IN MY DEMAT ACCOUNT ?
This is not correct.
Hi Ayush, you cannot use the collateral margin recieved from pledging securities to purchase shares, for that you will need cash.
Continuing the discussion from Peak margin, Intraday leverages, & 2nd order effects - Dec 1st 2020:
BECAUSE OF THIS 20% MARGIN BLOCKAGE SYSTEM, IT HAS RESULTED INTO HUGE LOSSES TO ME. YESTERDAY I.E. 2.12.2020 I SOLD ITC 1000 SHARES - MY 20% MARGIN WAS BLOCKED AND YOU ARE NOT ALLOWING ME TO BUY REMAINING 20% EQUITY SHARE AGAINST PLEDGED SHARES TO TAKE DELIVERY OF EQUITY SHARES. I COULD BUY ONLY 80% AMOUNT OF HEMISPHERE SHARES. NOW HEMISPHERE LTD HAS INCREASED BY ALMOST 22%. SO I AM CLOSING MY ZERODHA ACCOUNT, PLEASE TELL ME THE PROCEDURE TO TRANSFER MY SHARES TO OTHER DEMAT ACCOUNT OF OTHER BROKERAGE HOUSE WHERE I GET FULL SERVICE.
Hi Prateek, the MIS margin requirements are 20% of SPAN margin and 100% Exposure margin, you can check and confirm.
The rules are same across brokers, it is a regulation ,no broker will give you 100%.
Continuing the discussion from Peak margin, Intraday leverages, & 2nd order effects - Dec 1st 2020:
Hi,
Thanks for the revert, yes the match does add up now. But why is done this way?
All other brokers are providing leverage directly on the total margin required and not this way.
The impact of this calculation is almost double the margin for hedged positions.
I thought post the SEBI rule change all brokers would have almost the same logic.
Continuing the discussion from Peak margin, Intraday leverages, & 2nd order effects - Dec 1st 2020:
OTHER BROKERS ARE ALLOWING ME TO TAKE DELIVERY OF EQUITY SHARES IF I PLEDGE MY OTHER SHARES AGAINST IT. AND I HAVE TRIED THIS IN MY OTHER BROKER ACCOUNT AND THEY ARE GIVING ME. SO WHY ZERODHA IS NOT GIVING ME THIS FACILITY ?
To cover for hedge positions for mis, as for hedge there will be no span and if exposure also reduces then it is too risky for broker, because after taking hedge one can square off hedge leg and carry one sided.
i was completely unaware about 80% credit on sold holdings until it occurred to me today
this is pain for traders. @nithin we will need zerodha to be more informative and bring transparency on notifying the traders because at the moment there is literally no track of rest of the 20% margin on user interface.
Why other brokerage like Zeodhan, upstox , Angel broking do not go complaint against sebi like wisdom capital does? Are you really in favour of this sebi rule? Why don’t you care about retail trader? As a zerodha customer, I am really shameful. Please do something zerodha.
Hi, we are working on way to show blocked funds separately in your account.
Life is unfair and corporates and government don’t care about the public. So…
I was told over Zerodha support call that even with new margin penalty system, for MIS F&O trades, even if margin during intraday trading goes in negative, there will not be any penalty as only EOD margin reporting will be done to the exchange. So if EOD margin is in +ive, no penalty will be levied.
This is contradictory to information shared in above thread.
Is this true that during intraday, margin can go -ive for F&O trades without risk of any penalty?
Continuing the discussion from Peak margin, Intraday leverages, & 2nd order effects - Dec 1st 2020:
Is this calculation of Intraday margin for multileg options (20% of SPAN + 100% of exposure) unique to Zerodha or will this be the same for all brokers due to SEBI rule? @ShubhS9 @siva
Intraday margin rules is upto broker, but max is set by SEBI. We charge 100% of exposure because for hedge positions it will be blocking very less and to cover risk for broker we ask 100% of exposure but there will be no or less span charged for hedge positions.
You have buy and sell shares on same day.
See MIS option in kite.