Just a quick question. Can I pledge Liquidbees or other stocks and trade intraday in cash markets using that collateral?
Or, I can only trade F&O using that collateral? @ShubhS9 @siva
No. The collateral margin can only be used for intraday equity, trading futures and shorting options. For equity delivery and buying options, you will need cash in your account.
Yes, you can use the collateral margin for trading intraday equity (MIS, CO).
Hi Shubh,
I have seen mixed answers for this: Is 50:50 requirement for Intraday as well or if i get 80K after haircut, that can be used fully without any interest/shortfall?
thanks
For intraday trades you can use full collateral margin, there won’t be interest charged on it. The 50:50 requirement as explained above is for overnight positions.
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Thanks, is there any resource where I can compare the pros and cons of pledging Mutual Funds Vs ETFs. Just considering if NiftyBees is a better deal or Index Fund Via Coin, purely from pledge benefit stand point - Both I intend to just hold and use it for margin. Your point of view is welcome. Thanks for responding 
I have a question to zerodha here. i was on net debit for a couple of days in my account and was travelling etc , so i thought zerodha would unpledge and square off my positions. i didnt bother to fund my acct as i thought they can square off any scrip as market is at high. But last one week, they didnt square off but charging me late payement fee. there is email sent everyday saying they would square off my positions, but they didnt. Also There is no email that we would be charged late payement fee etc but they were charging it. seems they are no different than other brokers.
Lol dude. Most people don’t want their holdings sold. They want to be given time to add cash and settle the debt with broker. If you want your holdings sold then do it yourself and settle the debt. Or wait for a month or so and zerodha will sell it for you and charge your many penalties too.
Can’t believe how some people behave. Carrying negative balance. Getting emails daily. Can sell holdings or add cash at the push of a button. Chooses to do nothing. Then complains about late payment. “liquidation” is a bad word and most clients don’t want their holdings to be liquidated suddenly. This penalty can be called stupidity penalty as well. Next time, don’t be stupid.
ETFs will score over mutual funds if you need to liquidate on daily basis - as a limit order can be placed for a NAV you prefer.
Mutual funds are liquidated at market price - you wont have a control on the final sold NAV
Also refer the expense ratio, tracking error of ETF vs its mutual fund. 9/10 times ETFs are better and also their haircut is lower too.
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Hi, is this a departure from the old rule? Sorry for digging an old topic but I keep reading conflicting answers at different places.
In one post above, you mentioned that intraday options selling can use 100% of the collateral margin. With the new margin rules (applicable from Feb 28, 2022), will that change and is the 50:50 rule now applicable to intraday too (Previously applicable only to overnight trades)?
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For intraday, you can continue to use 100% collateral margin. No change in this.
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Liquid funds are treated like cash similar to liquid bees.
50% rule is not applicable if you pledge liquid bees or liquid funds.
Is the above statement are correct?
All cash components are not applicable to the 50%rule, please confirm this.
If you have pledged cash-component securities you can utilize 100% of the margin. The 50% rule isn’t applicable. However, would suggest you keep some cash balance in your account to in case of losses and charges and collateral margin cannot be used towards this. Not having sufficient cash will result in your account going in debit balance on which interest will be applicable at 0.05% per day.
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So if i have pledged some shares and got x amount as collateral margin and my cash margin is zero can i still trade 1. Intraday Equity 2. intraday option buying 3. intraday option selling 3. delivery equity 4. overnight options buy or sell
if not which of the following is allowed ??
And do we still get the benefit of the price difference while the stock is pledged
You will be able to trade. However, would suggest you keep cash balance in your account to cover losses and charges. Collateral margin cannot be used towards this. If you don’t have cash then your account will result in negative balance, on which interest is charged at 0.05% per day.
Also, once the account balance is in negative, you will not be able to trade using collateral margin. Explained here.
The collateral margin can be used for intraday equity, trading futures and selling options. For equity delivery and buying options, you will need cash in your account.
Yes, infact the collateral margin you get will change based on price of holdings pledged. If the price increase, collateral margin will increase, it price decreases, collateral margin will decrease.
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hi
my margin money comes down if i take hedged positions so lets say
sold 1 call option
margin required 100rs
bought 1 call option
margin reduced to say 60 rs
now if i want to use collateral margin will it be 30 cash + 30 collateral???. I have confusion since buying requires cash not margin .plzz help
Margin is always blocked on the short side only.
So when you short a inr.50 with margin 1L, that inr. 50 is rec’d as option premium.
Next when you buy, if you buy an inr. 40, then you will still be net inr.10+,
if you buy for inr. 60, you will be net inr. -10.
So whatever this amount is adjusted and that is what net cash will look like but that inr. 50 rec’d is also part of the calculation in cash.
Margin will be blocked separately,
you did not specify what collateral.
If it is liquid collateral, then your cash margin is total cash + collateral liquid ( no 50-50 reqd)
If collateral is non-liquid, then you need to ensure that there is enough of 50% of required margin that comes from cash + liquid collateral and the remaining is utilized from non-liquid collateral.
I dont see nudge or face any issues practically because my liquid collateral itself is far greater than collateral from Equity so i wont have shortfall in margin plus additional cash.
rest is explained by ShubhS9 in 2 posts above this one.
Hi,
I had pledged my HDFC Bank shares. However since Friday I am not able to see the shares even under the Holdings tab on Console.
What could be the issue? What could make it happen? Account value is also reduced by the same amount of the shares that I hold.
Needless to say, I can’t even un-pledge the shares as they are no where to be seen.
For account related queries would suggest you create a ticket at support.zerodha.com. If you already have created a ticket, DM me the ticket number. Will have this checked.