Retail pledging related queries

Hello Friends,

Please help me understand these following queries:

  1. Even if Liquidbees is deemed as liquid cash by exchanges, despite of holding it in my demat, do I need to put 50% separate cash margin w.r.t. 50% collateral margin in order to meet a position’s required margin after the specified haircut? Does the same rule apply when I am pledging Liquidbees itself?

  2. Is the other remaining 50% of collateral margin always going to sit idle?

  3. In which segments do you allow utilization of collateral margin?

  4. In what all scenarios, interest rate and at what rate is charged for using this collateral margin?

  5. Let’s say summing my cash and collateral margin I have Rs.1 Lac where Rs.50,000 is cash and the other Rs.50,000 is collateral margin which I got after pledging 100 shares of XYZ. Now I incurr a loss of Rs.10,000 MTM in a position and I square-off. After that I unpledge too. What will happen to my cash margin, collateral margin and to the quantity of XYZ shares that I held in my demat originally used for pledging?

  6. Does GST apply to the charge of Rs.120 per scrip (including both pledge and unpledge)?

  7. Time taken for the amount to show-up as collateral margin?

Thank you very much for your time.

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Zerodha imposes a haircut of 10% on LiquidBees.

You will be able to use this entire margin after haircut for taking intraday or overnight positions in Futures. For overnight F&O positions, 50% of the margin needs to compulsorily come in cash and the remaining 50% can be in terms of collateral margin.

Equity Intraday, Futures long & short & Options writing.

If you don’t have enough cash, your account will be in debit balance and there will be an interest charge also called delayed payment charges of 0.05% per day applicable on the debit amount. The interest will be charged on a daily basis.

MTM Loss of Rs.10,000, Pledging Charge & Taxes will be settled through Cash Balance. Shares will be unpledged & you can check in holding. You will get benefits of all corporate actions like dividends, splits, bonuses, etc. on the stocks you have pledged.

The cost of pledging will be Rs.60 + GST irrespective of the quantity pledged. There is no cost for un-pledging.

If you have pledged before 4 pm, the collateral margin will be available on T+1 day. If pledged after 4 pm it will be processed the next day i.e will be available on T+2 day.


Thank you @TRILOCHANRAI for explaining that in details!

If you pledge Liquibees the margin you get after haircut will act as cash margin.

Thank you @Rockey19!

Exactly, this bit is confusing me. So, I need no extra 50% cash along with the margin received after haircut of pledging Liquidbees?

Dilemma is that if this acts as cash margin, how losses, charges, tax will get adjusted and what will happen to the original number of my Liquidbees position after unpledging?

Hi @TRILOCHANRAI @CougarTrader The above is not true. Above rule is only for the broker and not for the broker clients. You can always challenge your broker on this only if you have deep pockets and broker is able to earn reasonable amount of brokerage from you otherwise they won’t entertain you on this.

There are brokers who provide their clients with overnight positions only with collateral margin.

Google it, inquire about them and you will find out. Thanks

Happy Trading…!!

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Sir you have to settle your MTM loss in cash to avoid late payment charges i.e. interest.

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