Strike price is outside the allowed range

@nithin , @siva
Greetings to both of you .
I recently had a trade on nifty 8800 pe 23rd April exp(short option on Friday 4/17/2020 morning) , By Evening i was well in profits .
Now Before the markets close i wanted to hedge my position by buying a lower strike pe 8700 which was within range as per https://zerodha.com/margin-calculator/SPAN/ .

1)Why could i not buy the 8700 PE despite it being in range ?(I assume its because of 500 CR limit reached by zerodha)
2)Now that my options are left un-hedged , how can i prevent such a situation in the future . How will i know if the hedge option i m supposed to buy will be blocked or Allowed ?
3) Is it possible to allow a even lower contract such as 8600 pe to be purchased if the 15% limit of total OI in Niftyoption contract is not reached ?

Kindly Guide on this .

Regards
Suhas

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After sebi put limits on derivatives for Fpis market Open interest has come down drastically and hence our limits. This rule is in place till 24th of this month, hope sebi won’t extend it. Also we are coming out with alternate solution for this. If you want to try you can email to [email protected]

Hi @siva ,
Can you confirm if the rule is still in place ?

I tried to buy open APR BANKNIFTY 21000 or even 22000 CE or 18000PE hopting outside 1 % . both opening position orders got rejected.
basically BankNifty options are not tradeable at Zerodha.That is a pity !
I did not find any problem in NIFTY options yet .

Monday morning I should mail to mr faisal may be which strikes of April 30 BankNifty PE/CE will be allowed to trade (opening position )

@siva does FPI limit increased to normal

@siva "Strike price is outside the allowed range. Try a strike closer to the spot price. "

  1. If i want to hedge deep otm call how can i do that?

  2. If restriction in place , then who are buying those or how they are buying it ? . Because i am able to sell deep OTM call/put

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No, the date is till 25th june.

We will do something in coming days regarding this.

This restriction is seriously hampering me to hedge my positions. In my opinion you shouldn’t roll out something which wouldn’t let people follow good practices.
As a Zerodha user, I am always very proud of the UI and UX, but this thing is restricting me to do basic fundamental things. This is putting us Zerodha users at a disadvantage.
I would urge you fix this as you have put the restriction for a long time and you had at least same amount of time to do the right thing of allowing the users to do the right thing.

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After the new Margin, hedging is the key to keep the margin low and for that buying deep OTM put/call is required to implement certain strategies.
Can you please tell us, when does the deep OTM call/put BUY will be enabled.

@siva @nithin Do you guys have any timeline which you can share with us so we can have some clarity on this aspect.

We are working on something, give us sometime.

Hello Siva, approximately when we would expect the solution to this problem of restrictions on far otm strikes.
I have pledged stocks and bees to use it as margin in fno.
If you do not solve the problem, unfortunately I would have to sell all portfolio and switch to new broker.
Kindly resolve the problem earliest, Zerodha is so awesome, we don’t want to leave that :slight_smile:

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@siva and @nithin I think you guys should respect that your user’s need some timeline so they can plan accordingly.

We will be moving few clients in coming two weeks to custodian route, also on 25th of this month SEBI restriction on FPIs and others on limits in derivatives will come to end, we believe this can boost market OI. So,we believe in coming 2 to 4 weeks we should see some improvement.

If SEBI restriction on FPIs and others on limits in derivatives will come to end ; then ;
Why u need to move few clients in to custodian route ?

Market timing extension about to happen?

@siva @nithin @Bhuvanesh today i cannot buy option in nifty , its really useless trading in zerodha , i cannot get margin hedge benefit ,
how zerodha will work we know … before you told we will come spread strategy and we will implement in kite as a first broker
but all broker are implemented the strategy system in web and desktop , some broker really changed the full web trading also to give smooth experience to its clients , but zerodha never came anything now ,
please tell if you cannot allow OTM option let us know pls , i will try to move other broker ,

please reply as soon as possible - i will wait for your message

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Which strike you planned to buy today?

Which strikes zerodha blocked.