I had taken short strangle in BNF monthly expiry options. Utilised maximum available limit. However, I was charged short penalty. Reason, reqd margin was greater than available capital. When I questioned the broker how was I allowed to take the trades beyond my capital, they said the margin blocked will not be the same and they receive actual margin requirement from exchange at EOD. IS this true and valid?
Could you please provide more details?
- Was there unrealized loss and so more margin needed to be blocked?
- Was the additional margin needed due to it being near expiry?
Edit: I suppose this is a required margin shortage scenario. Required margin is what will be required to place all the orders, otherwise order shouldn’t have gone through? @ShubhS9
There was no unrealized loss.
Trades were taken on 28th April, expiry on 29th April
Is there were a way to verify required margin from the exchange?
Right, if you don’t have sufficient margins to place the order, it’ll be rejected.
You can easily check the margin requirements here.
Yet again, the broker claims that the margin requirement is different from what is blocked or what is calculated from the margin calculator. And they receive the margin files from exchange by EOD.
What is your broker’s name ?