Sebi and other regulators can’t control mutual and debt funds, let alone manage FnO and other things . Liquidity dried up from physical settlement to increased margins to curb on fii/dii limit to what not. And the persons incharged in sebi is not an investor /businessman/trader .
Hey… If I have bought some shares in the past paying 100% n shares is in my demat account and I want to sell the stock …do I have to keep the var+elm margin in my account…???
SEBI is also working on realtime settlement in place of the current T+2 mechanism.
Once this is in place, it would definitely be a more ideal scenario.
A more ideal market, with lesser settlement risks, will definitely attract more liquidity.
@siva no. Thats what nithin clarified right? They will deduct shares on T date and hence we can sell
Hold on so how do people who hold crores worth of shares sell their holdings all at once? Do they bring in margin money so that they can sell what they own in the first place? Exchange may not know but broker certainly has that detail right?
But thankfully, there is a way around this by using what is called Early Payin (EPI). So instead of waiting for 2 days, if the broker can debit the Rs 1 lakh of Reliance from your demat and give it to the exchange by the end of the same day you sold the shares, a broker can allow you to sell without asking for any upfront margin. At Zerodha, we currently debit the shares and give it to exchanges on T+1 day (it is still Early payin as we don’t wait for T+2). We are working on having our systems ready to do Early Payin on T day so that you don’t have to have the margin in your account to sell your stocks from Aug 1st 2020
But as Nithin Kamat said …that as zerodha has a early payin system where you don’t need to have a margin money for selling your stocks…do all other brokers have a early pay in system…where they debit the shares from clients demat and provide it to NSE in T or T+1 days…?
My broker is sbi cap
No for what? din’t get it.
No problem in this case.
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I think all the pain and woe are due to T+2 settlement. If everything is T+1, these will be more logical and acceptable.
Is T+1 possible in near future?
Was this new restriction put in place because of the issue that happened with Axis MF’s ETF prices on Friday?
When the directive came that all trades before 9:50 AM on 24th July 2020 done in AXISGOLD and AXISNIFTY would be canceled (https://economictimes.indiatimes.com/markets/stocks/news/2-etf-prices-jump-up-to-6553-in-nse-tech-glitch-all-trades-cancelled/articleshow/77145508.cms), I got curious about the scenario -
Suppose a person purchased those ETFs on 23rd July (at the lower price after their split) and then sold them on 24th July before 9:50 AM at the profit of 6,553% and 741%. After that, they used those proceeds to enter into a new trade. As NSE decided to cancel those ETF trades, what exactly happens with the subsequent trades that the person took using the proceeds of the canceled trades?
@nithin @siva @ShubhS9
If i have 1lakh in my acc whise var+elm is 25k
Q1. Can I use only 25k for btst or swing trade or this is for intraday?
Q2. Should I need to pay adhoc margin for intraday?
Q3. In what case I should pay var+elm for square-off?
Q4. If I do intraday, will I face margin block for t+2d?
@siva can you please dispel the doubts on following topics
- When can one use realized profit from short options (On the same day or next day)?
- In case of realized losses arising out of short option square off, when money will be debited from total margin available (same day or next day)
Thanks and regards
Amit
All the sell credit has been removed by the broker to avoid misuse of incorrect credit sell value.
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Realised profit can be used the next day.
The loss will be debited the same day.
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@nithin - For overnight long positions in F&O, if we exit, can we use the proceeds to short stocks or options in intraday? And for trading in futures / short options / buy stocks, is it T+2 day that we will be able to do all this?
Already answered multiple times above, Please scroll up and try to read.
Yes, FNO exit proceeds can be used for any, only long options closed today should be used to buy another option on T day as money will be realised on T+1.
@siva the question was this
I have shares in my demat. I just need to sell it. For selling should i keep margin amount?
I guess account balance can be zero and still will be able to sell my valid demat shares. Because u will debit the shares on same day T? Please confirm that probably in a separate reply as lot of investors are worried on this basic feature
You can sell it with zero cash balance in your account.
Hello @nithin ,
As far as my cash/equity trades are concerned this decision will increase my working capital requirements as a trader and I guess this will bring down the working capital of brokers (not sure on this).
But for those traders who cannot increase their working capital either it will result to less number of trades which in turn will dry up the liquidity or traders will opt for Margin Trading facility (MTF) which will increase the leverage on traders and will fail to fulfill SEBI’s stated objective to protect Retail Traders.
My question is: You or your rep might have had an interaction with SEBI regarding this issue. What was the reason that was stated by SEBI to introduce this step.
1> Was there any fraudulent practices that were going on by any broker which resulted in SEBI to take such a drastic step ? If yes, Please elaborate on this.
2> Will zerodha start providing Margin Trading in near future ?
3> If I do not get to trade on my sell amount untill T+2 Day then on my long trades (buy) only Margins should be deducted on T Day and rest amount should be made available to me to trade till T+1 Day. (I know this process will make things a whole lot complex for brokers and is not practical for large brokers)
For me only logical option seems is to increase my working capital.
thanks.