OK so everyone is asking what’s the reason for the penalties. So I have been charged penalties 7 times and if you would know the ledger tells you for which date you been charged the penalty. Out of of this, three times I had a negative margin and four times I had a positive one. Just so you know, earlier I had plenty of times a negative margin but wasn’t charged a single penalty. Now from how I understand the new rules , a thread for which can be found here -
Then a negative margin now would attract a higher penalty because previously even if you had a negative margin, that negative margin would be reduced by the fact that you paid for exposure along with span. But now that is not the case. Now even if you have paid for the span and exposure and you have a negative margin, then you would have to pay a penalty on the entire negative margin. Let me explain by an example -
Let’s just say that you have 1lac rupees as free cash in your account and you take a futures position for which you pay 1lac as both span and exposure with let’s say span being 60000 and exposure being 40000. Now if during the day the position moves against you and you are making a loss of let’s say 20000, then technically you have a negative margin of 20000. Earlier you wouldn’t pay a penalty because you already paid for the exposure but now you’ll have to pay a penalty on the 20000 which you have as negative margin. You are practically making more loss by going into a loss. At least this is what I’m understanding. As for a penalty being charged on a positive amount, I don’t really understand why that’s happening but I’m guessing it’s because of the “encumbered/uncumbered” margin rule. What do you guys say?