While it shows margins correctly for sell options, it shows as NA for buy options.
Why is this? Can @nithin @Bhuvan @MohammedFaisal @siva help?
Why is this? Can @nithin @Bhuvan @MohammedFaisal @siva help?
When you buy options there is no concept of margins. You pay only a premium, and since maximum you can lose is the premium itself, there is no margin asked. Margins are asked for short option and futures positions.
But long option does give you margin benefit if you have other positions which require margin and hedge each other. For example check this, Short 10700 Calls and Long 10800 Nifty calls - bear call spread.
For those who don’t know, our SPAN calculator: F&O margin calculator - Zerodha Margin Calculator
Buying the long option is reducing the margin requirement for the short option by almost 32k.
I have had some people ask, is this 52k required post paying for the premium or that is separate?
Ans: This is including the premium you pay for buying the option.
The premium receivable section you see = short option premium - buy option premium.
Yesterday the closing price of 10800 calls was 61.15 and 10700 calls 117.5.
Premium receivable =(117.575) - (61.1575) =4226.25
Note that our SPAN calculator picks up previous closing price (yesterday’s closing price) for all calculations. It doesn’t pick up the live price of the option, so there could be variance in actual margin required to what is showing on the calculator when markets are open.
Btw, if you had to enter the above strategy with just 52519, first take the buy option trade and then the short option trade. This way you’d get the margin benefit when entering the sell trade. If you were to take the short option trade first, you will need the entire 84524 and you’d get the margin benefit only once the buy trade is also taken.