Understanding risk management for MIS trades

Zerodha
21

Maybe your order will be rejected due to" Price is Out Execution Range" (usually happenes in highly volatile market)

22

Are you from Zerodha team or a member / client of Zerodha ? How does the system or RMS team just ignore when the negative figure is 300% of margin ?

23

In FNO segment there was a possibility of unlimited profit/loss.If the market is so volatile I think broker also cant do much.It is not possible that you can loss only the amount you had in your amount.If the market is highly volatile constantly hitting circuits nobody can do anything.As a trader we must keep close observation on stock movement and should place stop loss orders.
You can refer this link https://www.businessinsider.in/A-trader-started-a-GoFundMe-page-to-pay-back-100000-to-E-Trade-after-a-disastrous-short/articleshow/49851611.cms
If you are having 30 k in your account and you lost 1 lakh. Remaining 70 k is bad debt for broker also.So broker also dont want the account to go excess loss but some times nobody can do anything due to abrupt movement.

24

ā€œAll positions will be subject to square off if your losses exceed 50% of the available funds in your account. This will be done at the discretion of our RMS team and there will be no margin call.ā€ā€¦

@sps
@Matti
@PriyaNT
@mac76
@Lets_Invest
@basha
@RagavendranMrn
@Prashi

1.Does this Query got it answered/ clarified by zerodha support?.. @nithin I am newbie, PL clarify it at the earliest in this regard

  1. AND WHAT IF INCASE OF proper BO/CO postition and MIS position with Stoploss limit trigger (which if suppose didnā€™t triggered in sudden volatility)ā€¦

  2. To Zerodha:

This qna is at its best, unique , knowledge & experience from our fellow traders are very much helpfulā€¦ besides, can you provide support team links @ā€¦, etc., If we suppose to address our direct queries & doubts to Zerodha team in this forum?

thanks in advanceā€¦

25

Any open positions can be squared off by RMS team, if the overall available funds in your account do not account for Exchange Specified Margin.Typically these square offs happen when losses exceed 50% of the margin required. But there is no guarantee by the broker that it will be square off 100% loss of your capital (if market is highly volatile).

26

@sps
@Matti
@PriyaNT
@mac76
@Lets_Invest
@basha
@Prashi
@nithin

  1. Myself, once experienced this kind of problem, but in my case it is BRACKET ORDER - Buy limit orderā€¦ My stop loss trigger not executed; price went below my stop loss trigger, but in reversal it got it triggered, lead to my about RS.300 lossā€¦ after price jumped above my TGT levelā€¦ (Took screenshot, but I need to find out, I will post it later) ; Why did this happen even though I placed SL trigger within the limits?

  2. And @PriyaNT, did you receive any reply or guidance from zerodha support team in your above issue? Can you share it if soā€¦ plā€¦

  3. @nithin once again, I introduce myself new to Zerodha, newbie in the world of trading, I keep on studying zerodha Versity & and reading tradingqna regularly, but I regret to register/ bring to your notice here so many queries are unanswered from zerodha team for proper & genuine understandingsā€¦ PL look into itā€¦ thanksā€¦

27

Please go through below link to know risk involved in BO/CO

28

Thanks for immediate replyā€¦

But, if my order is BO/CO-i.e., Intraday order, hence strict Stop loss trigger there by defaultā€¦ this SL trigger price also well & within the limit of my margin/ available fund limit in any worst scenario ( because zerodha doesnā€™t not allow any SL trigger price levels beyond my available fund limit)ā€¦ PL GUIDE ME HERE,

1- IF MY SL ORDER NOT TRIGGERED AT 3:20 PM, AND THE LTP IS WITHIN BUY & SL TRIGGER LIMIT, RMS TEAM IN WHAT PRICE WILL AUTO- SQUARE OFF? (Pl imagine I forgot to sq.off till the market close)ā€¦

  1. IF MY SL ORDER NOT TRIGGERED AT 3:20 PM, AND THE LTP IS BEYOND MY SL TRIGGER LIMIT (I personally experienced this scenario),

RMS TEAM IN WHAT PRICE WILL AUTO- SQUARE OFF- Whether at SL TRIGGER PRICE LVL
or at Zerodhaā€™s any own auto-square off method of calculation
or at market close LTP lvl
or at my available fund limit equaling to Rs. 0
or at beyond my available fund limit, i.e., making my account balance in NEGATIVE? (IN MY PERSONAL CASE, AUTO SQ-OFF DONE AT MY NEGATIVE ACCOUNT BALANCE -RS.300/-; I immediately transferred amount from my bank account to Zerodha to avoid any penalty/interest charges from zerodha AND UNFORTUNATELY, I WAS MISSED TO TAKE UP TO THIS MATTER TO ZERODHA TEAM THAT TIME)ā€¦

  1. And whether these issues arises by any unknown issues in zerodha software/ app or is there any acceptable theory and written rules & regulations behind that to justify it from Zerodha?

Pl guide meā€¦in query wiseā€¦ thanks in advanceā€¦

1 Like