Using Pledge margin why 50% should be cash?

[ramesh1985]

Hi,

While pledging holdings and using as margin for option selling. Zerodha is asking 50% margin for option selling as cash and only remaining 50% margin for the pledge.

Some other prominent brokers allow 100% margin from pledge stock to trade F&O.

@nithin @siva-reddy Please let’s know when this will be implemented in Zerodha.

[nithin]

@ramesh1985

While pledging holdings and using as margin for option selling. Zerodha is asking 50% margin for option selling as cash and only remaining 50% margin for the pledge.

Some other prominent brokers allow 100% margin from pledge stock to trade F&O.

Check this from NSE website.

All brokers should ideally collect minimum 50% in cash. If today they aren’t collecting, it clearly means they are using some other client funds/collateral to fund your cash component. SEBI now is extremely strict about this non-compliance. If they haven’t yet stopped, they will soon have to stop this.