Possible to exit option position in loss when no available cash

F&O
1

Scenario:

  • Sufficient “available margin” (e.g. pledged liquid fund), but zero “available cash” in account
  • Sold index options for 10k premium
  • But market reversed, sold option price doubled and want to exit it at 20k loss

Will zerodha allow me to exit position, because i have ZERO “available cash” in account? Or will i have to always keep some cash available in account for such stop loss scenarios?

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2

In this case you need 10K additional cash to exit your position.

I’m not sure whether Zerodha lets you to exit position with available margin but you’ll have to pay penalty to Zerodha.

3

You will be able to exit the position, but your account will be in negative. You might have to add cash to take further trades.

You may get a notice to add funds or risk paying a penalty or square off your pledged position

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