I think @nithin sir is busy or otherwise not inclined to respond. I would be grateful if someone can post the SEBI circular that authorises the broker to treat my shares as pledged to him even though I have not pledged them. Zerodha, upstox, kotak and ICICIDIRECT do not provide any margin on the holdings without them being pledged (even for intraday) . Can the broker allow a position (in derivatives) to be carried forward when the margin falls below the exchange stipulated requirements? In that case what is the meaning of RMS? Assuming that it can be done, can the broker charge interest from me when the collateral margin is much higher (more than 5 tiimes) than the shortfall in margin stipulated by the exchange? It amounts to making the broker immune to risk while the client’ holdings are used by him for margin reporting to the exchange. Is it justified to charge interest when the value of securities after haircut is at least five times the shortfall in margin in carried forward positions? I do not know if I can name the broker who is doing this but will post in all forums to see that clients don’t get into hidden or fraudulent charges.
My holdings are worth more than 7 lakhs (all large cap stocks and ETFs) and the collateral will be at least 5 lakhs after haircut if I pledged them. The margin shortfall is less than 1 lakh. Under these circumstances is he authorised to collect interest? Was he not obliged to square off because PoA cannot mean he can sell or transfer my shares to his account!