Retailers will opt for options and only loose more money than in futures. With futures we can exit at cost if got stuck in sideways market, options will keep decaying and retailers keep waiting for cost price.
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Yep, we will try to have all growth funds be able to be pledged. Dividend funds will be tough to offer as dividends need to be manually credited from the pledge to your account and then reconciled. Painful process.
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Once the margin requirement goes down, a whole new world of options trading is going to open up. Check this example I was looking at earlier today
Thanks Nitin sir , i am expecting only growth fund
there is a meeting scheduled next week. For sure they will have rules to ensure one client funds can’t be used for others, but if they are okay with broker allowing leverage with their own funds, that will be like a dream. But highly unlikely.
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Karvy default is fraud not market oriented default .
It’s administrative fault not system risk
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Sebi takes Rs 86000 for banknifty as margin which is 55 percent more than any international market margin requirements.
Who moron make this law.
Can banknifty open 4300 points gapdown .
Hahahhaha
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Caution: To everyone Pleadging is not about getting extra margins, It is as risky as you trading with your own cash margins,
The difference is you invest in mf bonds etc you dont have idle cash, so you insted pledge the securities to take trades,
Assume your trade goes wrong with sudden market move, you have shortage of funds what brokers do is, they will sell your pledge securities and obtain the shortage cash,
It is as same as trading with your own cash,
It should not make you tempted to trade as Brokers provides Pledging of securities etc
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we need to pledge because we can trade only hedged positions its will be an extra returns , blindly i will not trade .
see for example covered call , any other margin requirment extra we can pledge these securities to manage the broker requirment , there is no loss are to manage the position i need to pledge these securities
@nithin thanks for sharing this, but we can’t expect retailers to go into option selling with limited capital and with adverse risk reward ratio. How much ever we hedge in options a 10% move can wipeout the account. In futures we trade only intraday with CO/BO, i first fix my loss then look for target price and keep trailing stop losses. Options selling or even buying is not for everyone. SEBI forcing many into it. And coming to US markets they only pay 12.5% of margin required for carrying forward of positions to next day for Intraday. one can trade micro s&p futures for as low as $50. why can we get the same. anyway its upto SEBI how to run the markets, I am planning to withdraw my capital and planning to open an US trading account, any suggestions regarding broker will be appreciated. Thank you.
@nithin if SEBI lowers the margin req for hedged positions…can we expect the margin required to be as low as Rs 10k for a lot
Yes, 10k to 15k for 1 lot of hedged position.
Can check this thread on trading in US markets from India, under LRS one is not allowed to trade in leveraged products, so for a small trader it is not possible to trade in US fno. Coming to equities ,soon we will allow our clients to be able to invest in US equities via our platforms.
Maybe in 2021?
@nithin does this have impact in currency options margin. We don’t have intraday in zerodha for currencies. But narrowing it down to 8x means will it increase margin to about 6 times?
In couple of months.
8x is the VAR+ELM for equities. Currency works on SPAN margin, nothing changes on that.
I mean will it be auto squared off by RMS