Why are BOD margins considered on trading platforms instead of latest SPAN margins?

Trading
85

By closing your position on T+1 day, the margins will be released, allowing you to collect the previous day’s shortfall on that day. As a result, there will be no MTM (non-upfront) margin shortfall for the previous day, and therefore, no penalty will be incurred.

1 Like
86

Hope you guys are still following this, because margin has definitely been higher the past few days, or maybe even much before that…

Unless the exchange themselves have increased the margin requirements…

87

Due to volatility margin went up on the exchange span itself. We are still updating only the BOD span and we don’t block any additional margin apart from the exchange stipulated span and exposure.

88

Hi,

I have bought 5000 shares of Suzlon which hit lower circui and now I have received the delivery of shares and I am seeing my account balance is in negative of 55K. I need to understand if I sell these shares today, the settlement will happen tomorrow and the debit balance gets cleared tomorrow. So for today, will there any margin shortfall penalty for the negative balance that I have or it is just the delatyed interest charge?

Also, please help me with the scenario where margin shortfall for equities trading occur and will there be any penalties for it.

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89

Hey,

In the event of an MIS trade, we collect a 20% margin from our clients, which serves as coverage for the upfront margin requirement.
The shortfall may occur in case the stock you traded has an Adhoc margin requirement on top of the VAR+ELM, and if you experience a mark-to-market (MTM) loss in such situations, any shortfall in non-upfront margin will be subject to penalties imposed on clients. To prevent incurring penalties, you can review the margin statement. If it indicates a shortfall, you have the option to transfer funds before 11:59 PM on the next trading day (T+1) to avoid the non-upfront penalty.
Please check this link to know more about how margin shortfall can occur.
If you have a negative balance, there is a possibility of incurring delayed payment charges. To learn more about the specific details and implications of delayed payment charges please check this article

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90

Hi, Can someone help me understand if a penalty is applicable, and some other things regarding physical settlement?

First, let me confirm a simpler case:
A) At end of a normal trading day, margin was say +1.5 Lakhs, but overnight due to increased volatility or higher nifty prices, the next morning Zerodha is showing that margin is -0.5 Lakhs. The user brings in 0.5 Lakhs say at 9:30 AM.

I am assuming there is no penalty applicable here, as the margin needs to be brought till midnight of T+1. Is this understanding correct?

Now, let me ask about this month’s expiry of 28th March:
B) The margin shown in Zerodha Funds page was positive till end of day 28th march.
But due to physical settlement of some stocks, the margin went into negative (big amount) as on 29th March morning. This was covered by me till the afternoon.
Will a penalty be applicable in this case?

Also, since Monday 1st April is settlement holiday, when is the earliest that the physically settled stocks can be sold to generate instant margin?

thanks