This Could be it FnO Traders!

[siva-reddy]

@SachinSingh

any particular reason for this? I know they carry unlimited risks but depending on your strategy, naked options/futures aren’t a bad thing. Margins have in any case increased a lot in the last few years. At least, I hope that the margins for far OTM options will remain untouched.

I believe they want to keep the margins similar to existing for naked but want to reduce for hedged positions. OTM may reduce a bit, I think.

[gaurav_choudhary]

@siva-reddy @nithin sir has the date for implementation of margin circular changed from 17th febto 1 st April as suggested by business line?

[maddy_Des]

17 feb is for starting reporting of “peak margin”
1 April is for penalties on the violation.
If confused - I have one word -

Bureaucracy.

[Hitesh_Pandya]

According to an article published in Business line the upfront margin collection from broker is extended till 1st April

[the_rock]

Hedge fund: Hedged trades may cost less as Sebi likely to lower margin requirements - The Economic Times https://m.economictimes.com/markets/stocks/news/hedged-trades-may-cost-less-as-sebi-likely-to-lower-margin-requirements/articleshow/73287285.cms

This is it!!!

[nithin]

@Hitesh_Pandya

According to an article published in Business line the upfront margin collection from broker is extended till 1st April

Too many things happening at the same time.

What is moved to April1st is upfront collection of margins for cash/equity trades. Until now there was no requirement, from April 1st it starts for cash markets similar to F&O.

[nithin]

@SachinSingh

any particular reason for this? I know they carry unlimited risks but depending on your strategy, naked options/futures aren’t a bad thing. Margins have in any case increased a lot in the last few years. At least, I hope that the margins for far OTM options will remain untouched.

Check this

https://www.nscclindia.com/NSCCL/risk/risk_ed_span.htm

While exposure margin will reduce, the PSR will be moved to 6 sigma. This will mean more SPAN margin, so the reduction in exposure margin will be made up by increase in SPAN. So the future SPAN+Exposure might be slightly more than current SPAN+Exposure for naked positions. But for hedged ones, the future proposed will be most likely 65%+ lesser.

[Hitesh_Pandya]

@nithin any update regarding relaxation in f/o intraday leverage?

[nithin]

@Hitesh_Pandya

any update regarding relaxation in f/o intraday leverage?

Nopes, will take another 3 to 4 weeks to know exactly what will happen.

[SachinSingh]

But why is it being moved to 6 sigma?

[nithin]

To compensate for reduction in exposure margin. Exposure margin is fixed, SPAN is variable. So if markets are not volatile the new margins will be slightly lower for naked positions, if markets are volatile margin for naked positions will go up more than what it is currently.

[deepak2508]

@nithin while making the necessary changes in your sw please ensure that it allows the traders to constantly do the changes in individual legs … many times only 1 leg need to be moved up or down for adjustment of strategy … these one leg adjustments should be allowed in the pair… thanks

[Arpan]

What about hedged CDS options , will the margin come down ?

[lotus]

Dear @deepak2508, NOT TO WORRY

As all PROFESSIONAL know except FEW that without adjustment it will be difficult.
I am sure @nithin will not block adjustment in one LEG.

[the_rock]

I understood why you are against “locking in”…

Lol… Yeah… It is kind of clipping wings of traders… True… But my only concern was to try and reduce margin requirement even further… FOR THOSE WHO WANT IT…

One solution to that is… Give an option for traders(before opening the position)…

If they choose to lock in and do not want to adjust… Then they can be given additional margin benefit…

Others who have the need to adjust can afford to forego the slight margin benefit… By choosing that they would like to adjust in the middle of the trade anytime…

@nithin @lotus Good enough… Right?

By the way @lotus… This is just speculating about what zerodha will implement or not… Lol… Don’t take these discussions seriously…

Who knows what policy zerodha will implement…

I will simply go with whoever gives the best product… That’s it… I have no brand loyalty

[lotus]

@the_rock, I know bro discussion here are not SEBI or NSE’s meet.
I just can’t support which I find illogical.
I am too in favor of MARGIN should come down.
WHO don’t want HIGHER ROI ?

[Riyas_Ahamed]

@nithin hai any news from sebi , hedged margin reduction , last week i seen in ET ,this week they will approve , eagerly waiting for this one ,

[PratikThakkarCO]

Will a BO option writing position with fixed SL in a highly liquid option chain (NF / BNF) - be considered as ‘LOW RISK’ ergo ‘LOW MARGIN’ requirement? - This will help guys who wanna take purely directional bets.

I agree that the lower margin will make spreads more appealing but single leg directional bets have better R:R and preferred sometimes in a strong uni-directional intraday trend.

[PratikThakkarCO]

Expecting a detailed Z-Connect post after all these changes come in effect…! Lot of important / worth noting points scattered in AMA threads!

[maddy_Des]

BO, CO - are just intraday leveraged products. They have got nothing to do with hedged position margining decision.
The decisions on BO, CO, MIS will be made in 2-3-4-5 weeks. Max 1 April