ETF – Exchange Traded Funds
Traders,
This is November 7, 2012 and very close to Diwali. This year the auspicious occasion of Dhanteras is on November 11, 2012.
Dhanteras as explained on wikipedia: Dhanteras (Hindi: धनतेरस, Marathi : Dhantrayodashi) is the first day of the five-day Diwali Festival as celebrated in parts of North India. The festival, known as “Dhantrayodashi” or “Dhanvantari Triodasi”. The word Dhan means wealth and Teras means 13th day as per Hindu calender. It is celebrated on the thirteenth lunar day of Krishna paksha (dark fortnight) in the Hindu calendar month of Ashwin.
On Dhanteras, the “Owl” form of Goddess Lakshmi is worshiped to provide prosperity and well being. Dhanteras holds special significance for the business community due to the customary purchases of precious metals on this day.
Gold is the favourite precious metal for all of us and typically gold is bought on Dhanteras. Buying gold as jewellery is not really the ideal way of investing as they are illiquid, you have to factor in making charges, etc… The best way to buy into gold for an investment is through ETFs (Exchange Traded Funds) and NSE is conducting a special session this Sunday to trade only Gold ETFs between 11:00 AM to 3:30 PM. So if you want to buy Gold as investment do it through your trading and demat account with Zerodha. Find following an image that shows how to add GOLD ETFs on the market watch and remember that to buy GOLD ETFs as an investment you need to have a demat account mapped to your trading account, so you can trade with the product type as CNC. If you want to do intraday trading, use the product type as MIS, but you will have to square it off before the end of the day.
As a small Diwali Gift, all our clients will be able to trade Gold ETFs with Zero brokerage this Dhanteras (November 11, 2012).
If you are unable to see the content above :Download Handbook on Exchange Traded Funds (ETFs) here.
List of Securities available for trading in ETF:
| Symbol | Underlying | Security Name |
| BANKBEES | Bank Nifty | Goldman Sachs Mutual Fund – Bank Nifty ETF |
| GOLDBEES | Gold | Goldman Sachs Mutual Fund – Gold ETF |
| GOLDSHARE | Gold | UTI Mutual Fund – Gold ETF |
| JUNIORBEES | Junior Nifty | Goldman Sachs Mutual Fund – Nifty Junior ETF |
| KOTAKGOLD | Gold | Kotak Mutual Fund – Gold ETF |
| KOTAKPSUBK | CNX PSU Bank Index | Kotak Mutual Fund – PSU Bank Index ETF |
| LIQUIDBEES | Government Securities | Goldman Sachs Mutual Fund – Liquidbees ETF |
| NIFTYBEES | Nifty | Goldman Sachs Mutual Fund – Nifty ETF |
| PSUBNKBEES | CNX PSU Bank Index | Goldman Sachs Mutual Fund – PSU Bank ETF |
| QGOLDHALF | Gold | Quantum Mutual Fund – Gold ETF |
| QNIFTY | Nifty | Quantum Mutual Fund – Nifty ETF |
| RELBANK | Bank Nifty | Reliance Mutual Fund – Bank Nifty ETF |
| RELGOLD | Gold | Reliance Mutual Fund – Gold ETF |
| SBIGETS | Gold | SBI Mutual Fund – Gold ETF |
| SHARIABEES | Shariah Index | Goldman Sachs Mutual Fund – Shariah Index ETF |
| KOTAKNIFTY | Nifty | Kotak Mutual Fund – Nifty ETF |
| HNGSNGBEES | Hang seng Index | Goldman Sachs Mutual Fund – Hang Seng ETF |
| RELIGAREGO | Gold | Religare Mutual Fund – Gold ETF |
| M50 | Nifty | Motilal Oswal Mutual Fund – Nifty ETF |
| HDFCMFGETF | Gold | HDFC Mutual Fund – HDFC Gold Exchange Traded Fund |
| IPGETF | Gold | ICICI Prudential Mutual Fund-ICICI Prudential Gold Exchange Traded Fund |
| INFRABEES | CNX Infra Index | Goldman Sachs Mutual Fund – Infra Goldman Sachs ETS |
| AXISGOLD | Gold | Axis Mutual Fund – Axis Gold ETF |
| M100 | Midcap | Motilal Oswal Mutual Fund – Midcap ETF |
| N100 | Nasdaq100 | Motilal Oswal Mutual Fund – Nasdaq ETF |
| BSLNIFTY | Nifty | Birla Sun Life Nifty ETF – Growth |
| IIFLNIFTY | Nifty | IIFL Mutual Fund – Nifty ETF |
| BSLGOLDETF | Gold | BIRLA SL GOLD ETF |
| RELGRNIFTY | Nifty | RELIGARE MF – NIFTY ETF |
| IDBIGOLD | Gold | IDBI Mutual Fund – IDBI Gold ETF |
| CRMFGETF | Gold | Canara Robeco Mutual Fund – Canara Robeco Gold Exchange Traded Fund |
| MGOLD | Gold | Motilal Oswal Mutual Fund – Motilal Oswal MOSt Shares Gold ETF |
| NIFETF | Nifty | ICICI Prudential Mutual Fund – ICICI Prudential Nifty ETF – GROWTH |
| RELCNX100 | CNX100 | R Shares CNX 100 Fund |
Hopefully, this clarifies all the doubts on ETFs.
Similar to Gold ETFs, another product which is getting popular of late is E-Gold. To buy E-Gold, your broker has to be a member of the National Spot Exchange (currently Zerodha is not) and the advantage of E-Gold over Gold ETF is that if you intend to take physical delivery of gold, in E-Gold you can for a quantity as small as 8 gm, whereas for a Gold ETF it is 1 kg upwards. Another difference is that you can trade Gold ETF till 3:30 PM (NSE), whereas E-Gold can be traded till the close of commodity markets. GOLD ETFs can be given as collateral for trading on NSE F&O, but E-Gold can’t. If you are looking at the products for investment, it shouldn’t really matter if it is Gold ETF or E-Gold.
*As everyone knows, now that this product ran into trouble with the failure of NSEL, you can read more on NSEL fiasco.
Wishing you all a lot of gold, a very Happy Diwali and a year filled with happiness, success and prosperity.
Happy Trading,
If Nippon Bankbees consists of portfolio of stocks as per Nifty Bank, shouldn’t it’s return be more than Nifty Bank?
Reason is, Nifty Bank index is made up of 12 Banking stocks and most of them pay dividends. These dividends get reinvested by Bankbees, which should get reflected in the returns, making its CAGR more than Nifty Bank’s CAGR. (Theoretically, If you would have invested in all 12 Banking stocks as per the composition of Bank Nifty, you would have got dividends and also capital appreciation, with CAGR as represented by Bank Nifty)
But in case of Bankbees we are getting only CAGR equivalent to Bank Nifty. Please help clear my doubt.
please explain Regarding Siverbees & Goldbees Taxation.
too much Confusion. as per some article it’s in Our income Tax Slab.
But Zerodha Another Other Broker show them in STCG if we hold more than 1 day. Which means in 15% Flat Tax Bracket.
Hi.. I have placed sell AMO on an ETF with disclosed quantity. My limit price was 172, the high was 174. Still my order didn’t execute. Whats going wrong here?
I cant find Nippon India NIFTY IT ETF on Zerodha. What is the ticker code for NIFTY IT ETF.
Just type ITBEES
Am using Kite application. I used to F&O trade usually. now i want to invest in Gold ETF. I do not have any ideas about the Gold ETF. Can you pls explain. Is it like a Equity shares?? Can i buy it now in Kite and hold it for 10 year?? How it works?? Can i have best ETF to invest for long term.. Can i sell it at any point of time in future??
Hi,
as you are aware, CRMFGETF has stop trading on stock exchange. My investment in this ETF was about Rs 16500. I wanted to know how do I remove my money? who should I approach.
is my investment gone?
Please reply urgently.
thanks
Hey Swanand. This ETF was merged into an MF recently. Please create a ticket on our Support Portal for assistance.
Hi sir, I am your customer and I like Zerodha as it grows and adapt just like a trader. I basically do intraday trading and you have given 20 depth to all your customers recently which is very useful in intraday trading. I just want you guys to please add a customisable hotkeys feature by which we can sell for example 10 % of our position with a press of a button and we can customise it to whatever the position we want to sell.Also when will we see bar replay function on intraday data so that we can practice trading when the market is clos
I’ll pass this on to the concerned team and try to make this possible.
In Zerodha tax statement liquid-bees dividends are shown as short term Trades profit. My auditor considers this as short term profit and asking me to pay tax for divided units. Can Zerodha remove this from short term profit and fix this?
Will look into this.
Where is Bharath 22 ETF i purchased listed…
In Kite app?
You can see it in your holdings on Kite.
This is with regards to the point on raising AMO orders for ETF. Even after adding disclosed qty , the order is getting rejected with the error message as below.
“The instrument is either suspended from trading, or the order was placed outside of trading hours (try placing AMO).”
I am placing a CNC limit order, selecting AMO & adding disclosed qty. Please suggest an alternative.
I too got same issue even after providing disclosed quantity.
Now it is working. We should provide the disclosed quantity less than total order quantity.
is the AMO facility available for SETFNIF50 ETF ?
Yes, you can place an AMO for ETFs as well.
Sir, Today morning hours at 01:06, I have placed AMO order for SETFNIF50 ETF as a limit order at price Rs. 119.00.
Below are the details:
Quantity
0 / 10
Price
119
Avg. price
0
Trigger price
0
Order type
LIMIT
Product
CNC
Validity
DAY
Order ID
XXXXXXXXXXXXXXXX
Exchange order ID
XXXXXXXXXXXXXXXX
Time
2019-10-23 09:00:10
Exchange time
2019-10-23 09:00:10
Placed by
XXYYZZ
It got rejected with below error message. I have more than required amount in zerodha account.
“The instrument is either suspended from trading, or the order was placed outside of trading hours (try placing AMO).”
Not sure why I got this error. Can someone explain please?
Ah. This happens when you place an AMO for an ETF. You see, there’s no pre-open session for ETFs. So the order gets rejected. The workaround for now, until we find a better fix for this, is to add disclosed quantity to the order. This will ensure that the order is sent to the exchange at 9:15 instead and it’ll be filled in the regular market.
Hello Sir,
I have tried with disclosed quantity also, but I am getting same error and order got rejected in pre-open session only. That means, I think there should be an issue in software that even after providing disclosed quantity, it is sending the order to exchange in pre-open session. Can you please help me on this.
Thank you.
Your disclosed quantity should not be equal to the total quantity of the order.
Hello sir,
Now it is working. We should provide the disclosed quantity less than total order quantity.
But I did not understand the logic behind this. Anyway it is working for now. Thank you very much Matti. 🙂
Thank you.
Hello sir,
How to handle if I need to purchase 1 quantity only?
Thanks,
Jeevan
Ah, for now, you’ll have to place a regular order when the markets open.
Hi,
I am new on Zerodha. My question is if I purchase/sale NIFTYBeES through this platform then what charges will be applied. I mean any and every kind of charge related to NIFTYBeES.
Waiting for your answer or any link where I can have my answers.
Thank you for your time.
All charges are available here.
Hi,
Thank you for your reply. I actually visited the page you mentioned before posting my question but I am not sure which of the charges mentioned on the page are applicable for NiftyBeES purchase. I am specifically interested in purchasing NiftyBeES. On the other hand, you can also tell me that if I want to invest exactly 1lakh then how much amount (total) will be spent on any kind of charges and rest will be used for NiftyBeES unite purchasing.
Thank you
NiftyBeES would be charged the same as any other stock. Check out our brokerage calculator to calculate charges.
Hi,
When I am trying to buy ETF, Stop loss option is being shown in Kite. Please reply how to use it.
Hi Nithin,
how long we can hold ETF.. if i want to invest for about 20 years or more.. is it possible with all the available ETFs ?
Hey Ekta, you can hold it for as long as you like 🙂
What is the current fee for ETF? is there a charge for both buyng and selling?
Sir, how to start SIP In ETF funds via your app. Explain steps
ETF funds are traded on the exchange unlike mutual funds so you can’t set up a SIP.
However, you can create an SIP alert on Sentinel and keep investing in ETF regularly
I want to invest 1 lac rupees on four ETFs scheme,( for pledge the same) including 2 liquid ETF, please sugest which are the best of four .
What is expected return on Liquid fund.
hi nithin
is a margin getting from pledging all ETF(approved) be considered as equivalent cash holding.
eg. if i have 5L invested in kotaknifty, N100 n bankbees, i will get 4L as margine. should i hold 50% cash
Only LiquidBees are considered cash equivalent, Adhik. You’ll need a 50% cash margin for the rest.
Hi, I am Zerodha user, want to invest each month in Gold ETF and that also for long term of 15 years and more . Not able to place the order as I am confused with options to be selected.like:
CNC or MIS ?
MKT,LMT,SL Or SLM ?
Qty and disclosure qty …Both to be filled or which one is mandatory to be filled ?
REGULAR,BO,CO Or AMO ?
Validity day or IOC ?
I placed and order but it got rejected with error “Adapter is not ready”. What does this mean ?
What are the charges if I buy or sell Gold etc from zerodha ?
Hey Vivek, the order types and various other fields are explained in the Kite user manual here. As for “Adapter not ready” , this error would have be seen if you were trying to place an order in off-market hours.
please tell me what are the brokerage for buying ETF NiftyBEES, and how can i buy Bonds in Zerodha
I am a zerodha user. what is margin required (leverage available) to say buy 1 share of an etf on zerodha (say relcnx100 or M100 etfs).
I am looking to see how I can get leveraged exposure to nifty midcap or small cap indices through these funds. Please share if there is any other way to achieve that leveraged exposure.
We offer leverage for the NIFTY BEES, KOTAKNIFTY and NIFTYIWIN currently. You can check the Equity margin calculator.
The reason we don’t offer leverage for most ETFs is the impact cost is quite high currently. As liquidity increases, we’ll start offer leverage for more ETFs
I purchased Bharat 22 ETF FFO in Jun 2018. I was expecting to get units in Demat account like other ETF. but to my surprise, I see there is Folio number associated with it. I was not expecting this.
Now I want to get rid of this folio number, please let me know how can unlink folio number.
I already have some units in my Demat account which I purchased from exchange, which are not associated with any folio.
When the ETF is held in demat mode, the folio number doesn’t really matter. This was the first time offline purchases were allowed for the Bharat 22 ETF, and hence the folio number. You can ignore this.
Hi Nithin, I bought 100 LIQUIDBEES on 23 Jan 2017 and sold 4 days later on 27 Jan 2018. But I did not get any extra units as dividend. I have checked in my CDSL demat also. It is not present in that too. I know units will be in fractions ( somewhere worth Rs 65). But I suppose I should still get it. isnt it?
Can you please clarify.
Regards,
Saurabh
correction. Bought 100 units on 23 Jan 2017 and sold all four days later on 27 Jan 2017.
sorry. I checked in my CDSL now and can see the units. (0.056). But now my questions is how can I sell those as I cannot see that in kite.
You’ll have to sell it back to the AMC directly. Details here.
I need a clarification on this topic,
I was planing to pledge stock for trading options. but it seems we need to have 50% balance in our account.
So, Pledging ETF we get 90% haircut and its almost like cash.
Can we buy nifty options pledging ETF without cash balance in the account? please clarify.
what is cost of buying etf?
I want to buy it as a investment for long term
Dear Nithin,
I am new to the world of ETFs and I am exploring the same. I logged in to Zerodha PI to find that individual scrips and ETFs (GOLD and indexes) are listed in the same list. It is very difficult to know the available ETFs on PI to trade? Is it possible to segregate scrips and ETFs?
Also, I will be glad if you can confirm whether the ETF shown in the following NSE links are the only ETFs available to trade in India?
https://www.nseindia.com/products/content/equities/etfs/equity.htm
https://www.nseindia.com/products/content/equities/etfs/gold.htm
Thanks and Regards,
Sharanu
ETFs trade in the same category as stocks on the exchange, hence shown on the same list. No way to segregate, I’m afraid. And yes, these are the tradeable ETFs.
hope BHARAT22 is listed. what is the symbol in Zerodha and how to buy it now via zerodha kite.
Yes it is, search for ‘bharatiwin’.
Hi Matti,
Am unable to get and add bharatiwin etf in kite. Please help
Hey Prasanna, it’s been renamed to ICICIB22.
Can i have link to subscribe BHARAT 22 ETF?
You can apply from https://zerodha.com/bharat22. Also, check this post for more details.
My order that I placed for KOTAKNIFTY and RELCNX100 got rejected with the error:
“security is not allowed to trade in this market”.
I had placed an AMO in the morning between 0200 – 0400. I tried placing it again multiple times only to get the same error until I got:
“admin stopped amo”
and I stopped trying
Shammi, looks like you have placed a CNC/MIS order, you need to select AMO. Check the Kite User Manual for more – https://kite.trade/docs/kite/.
how to trade or buy/sell Etf,bonds on zerodha platform send me link
Please refer this: https://kite.trade/docs/kite/#getting-started
Is there any date decided each month on which bonus units of liquidbees credited to account? Who decides that date?
If units are pledged with Zerodha, will I get additional units?
Dates is by Reliance mutual fund who manage liquidbees. Yes if units are pledged, you still get the dividends.
Hi, I have held certain qty of liquidbees in the month of apr 17 some were pledged and some were in the demat account. Today is 12th May but I am not seeing any dividend in my account. Further, How I can check my demat account holding. Thanx.
Hi Praveen,
If you’ve pledged Liquidbees units with Zerodha, you will receive the credit of such dividends in the form of additional units to your demat account.
You can register to Easi with CDSL to check your holdings in your demat account. Check the procedure here
When (aka What Date) are the dividends for LiquidBEES deposited into the account? How often does this happen (once a month or once a week?)
Happens once a month, dividends are in terms of new units, so gets credited to your demat.
Thank you Nithin. Is there anyway to check the Partial accruals until then? I was informed that only rounded units are credited to the account.
Was able to see it from the DP account! Thanks
Hello Sir,
I have some queries related to ETF’s.
1.Can I use SIP (means manually buying it daily whenever the price is low) or average for ETF’s like NIFTYIWIN, BSLNIFTY.?
2.What is the brokerage and transaction charges If suppose I bought NIFTYIWIN for this month worth of Rs.5000 @90 and if I sold @95 in the next month? Is there any hidden charges??
Thanks
1. Yep
2. We don’t charge any brokerage for delivery trades. All other charges for equity delivery trades are here: https://zerodha.com/charges
No query open after reading the discussion threads re ETFs…Nithin, really appreciate your efforts in responding to each and every query…Keep spreading the light and Best wishes….
Hi, Recently I had opened an account with Zerodha. I would like to invest in e gold just like stocks. Can you suggest me, how to buy e gold? Thanks in advance.
Search for Goldbees on Kite. You can buy that using product type as CNC
Hi!
I couldn’t see the p&l of cpse etf in kite holdings tab.
Its shows N/A.
Probably because the buy price is not getting picked. It will get fixed today.
Hi Team,
I have applied CPSE ETF and they are reflecting in the demat account. But they are not visible in my holding yet. Can you please let me know how to sell ETF in zerodha?
Regards
You should be seeing now, if you weren’t during the day, if you had called our office, they would have done this for u.
Dear Nithin
I have few doubts based on your remarks below :-
1. Is it possible to pledge only liquid bees or any ETF will do like Niifty ETF or Gold ETf etc ?
2. Are there any transaction costs or interest costs when your ETF is pledged for option writing ? Any details
3. What is the time interval involved between pledging and unpledging ? Suppose you wish to write a call in the next five minutes, will it be possible to do the same without seeking support from anyone and doing it on your own !
Please advice and thanks in advance.
Nithin Kamath says:
June 28, 2015 at 11:43 am
90% of liquid bees pledged can be used as margin. Remember though that only option writing/shorting is allowed using collateral margin.
¶
Reply
1. You can pledge Nifty/Gold ETF. Click here to get the entire list.
2. If you don’t maintain the ratio of cash & collateral, then yes, interest will be charged.
3. You can place request for pledge till 2pm. You’ll get pledged margins from the next day.
Thanks Venu
I mean suppose Nifty index is going up, at the same Goldman Sach becomes bankrupt (a worst case), will value of Niftybees go down, though its benchmark is Nifty index.
The AMC defines an objective and invests accordingly. Every unit of the ETF has to be backed by a “creation unit”. One creation unit is the denomination of underlying assets that can be redeemed for a certain number of ETF shares. So in the worst case scenario the underlying asset can be sold and the funds be recovered. You can post this query on http://tradingqna.com/ to get more responses.
Are they (fund house) not issuing units like what Mutual Funds do.
They are issuing units like MF, the only difference is that these units are tradeable on the exchange.
Sir,
Regarding Niftybees (benchmark is Nifty index), my doubt is : Suppose Nifty index is going up, at the same Goldman Sach company has some problem, will value of Niftybees go down, though it follows Nifty index.
I’m not sure what you mean when you say ‘problem’. You’ll have to know that Goldman Sachs is the Asset management company that manages Niftybees and the return/yield will closely correspond to the total returns of the securities as represented by the Nifty. Every AMC is required to stick by it’s Investment objective.
Sir,
This is regarding NIFTYBEES. Please clarify my doubt. Suppose I buy some units, what is happening. Whether a) somebody is selling their units (just like shares) OR b) Fund House is issuing new units. What is actually happening.
Somebody is selling their units.
Your support team unable to provide the scrip codes in BONDS which can be bought on exchange.In Market watch page all NCDs are not getting displayed.
Which platorm are you using? and which bonds do u intend to trade on?
I would like to invest LIQUIDBEES for long term through ZERODHA. What is the margin I’ll get from these LIQUIDBEES holdings, so that I can use it for Options trading?
90% of liquid bees pledged can be used as margin. Remember though that only option writing/shorting is allowed using collateral margin.
Hello,
There are many businesses which are creating these ETFs, like Goldman Sachs etc.
Can you please throw some light on how can these companies profit from creating these ETFs on exchanges if they are just traded on stock exchanges without the influence of creator companies once they are listed.
In short what motivates these companies to create ETFs?
Thanks
Sukesh
Sukesh, even if these are traded on exchanges the Fund house charges an expense ratio. The expense ratio is much lesser than the traditional mutual funds. So for Nifty bees managed by GS, they charge upto 0.8% annualized as an expense ratio. So if the fund size is say 5000 crore, they can make upto Rs 40 crores a year for managing this ETF.
Hi Nithin,
Thanks for clarifying. Can you also please elaborate on how and when will the expense ratio be charged? will it be debited from the trading account?
Also will these fund managing companies have any other benefit other than expense ratio? Like in arbitrage or any other kind of benefits?
Thanks
Sukesh
The expense ratio is directly charged on the fund on a daily basis. So the NAV that you see is after all expenses.
The only way the fund can earn revenue is via the expense ratio.
Thanks Nithin, in that case how does Liquid Bees work? As the price of liquid bees are always the same with a difference of 1 paise for 1000 rs at most.
Also can you please mention some of the uses of liquid bees? why are they required?
Once again, Thanks for all the knowledge you are sharing.
Liquid bees has daily dividend on it. So any gain made is given back as dividend which is again compulsorily reinvested. This is the reason the value remains the same at 1000. The longer you hold, the return is in terms of number of units. So if you invested 100 units at Rs 1000. After a while you will have 101 units at Rs 1000, so your return is Rs 1000. Liquid funds are basically like short term debt funds, have earned anywhere between 6 to 9% in the last 3 to 4 years.
Hi Nitin,
The income that is generated from selling the bonus Liquid Bees units earned – how is that treated? Is it dividend income and hence tax free, or will it be subject to capital gains?
Regards,
Devdutt
Yep according to current laws, dividends are tax free, hen returns on liquid funds are tax free.
Thank you Nithin.
Hi there,
I am an intraday trader in nifty options. I used to keep margin with zerodha. What is the procedure to convert that margin to liquidbees with zerodha itself and also use it the same liquidbees as margin. what is the costing in total.
Regards
Vaibhav Gandhi
9825500195
Note: I do appreciate your efforts in providing the best deal for traders and grooming them up.
Sir, Regarding Goldman Sachs Nifty Exchange Traded Scheme, it always follows NIFTY rates. Suppose, something goes wrong with the company Goldman Sachs itself, will its ETF rate have a deep cut compared to NIFTY. Please reply.
Sathees, nothing to worry about. Most of the business in the US happens on ETF’s (ETF’s have overtaken mutual funds). Even if the company shuts down, the ETF shouldn’t be affected.
As you said even if the company shuts down, the ETF shouldn’t be affected. Is it true? If the Managing Company is affected, naturally it should affect its ETF and other funds also. Is it ?. Please reply.
Sathees, the exchanges before they let anyone start an ETF make sure that there is a chinese wall between the normal business and the ETF in itself. So you don’t have to be worried.
I do SIP in ETFs. Do I need to pledge them every month (either for the additional amount or full) if I want a margin against my holdings? Is there any way I can give standing instructions to you to pledge the whole ETF holdings for collateral if recurring pledging is required?
You will have to pledge them every month. There is no standing instruction as such that we can take.
Sir, Presently I am doing options trading in Geojit. I have opened trading account in Zerodha also, but not started using zerodha daily, and would like to migrate to your one. I have found lot of utilities in your NEST, and in my opinion many are not worth for a general user. Since, you have a full team for development and updation of software, i hope you could easily develop a module for calculating ‘As of time PROFIT’. Eg:- I bought CALLS and sold PUTS on say 2 March. What is the PROFIT at a particular time. Now, everybody has to depend on either Calculator, Excel sheet or Rreliance money portfolio tacker with this provision. Could be please add a module for this purpose. This would be helpful to all of us.
Satheesh, why don’t you migrate to our new trading platform Pi which is in beta. This has that feature and a lot more. Check this post for more.
Guess u missed this question posted earlier.. reposting it-
Incase I buy NiftyBees and say AxisBank declares a dividend, do I receive this dividend? Is NiftyBees meant only for price appreciation or do we also get dividend benefit which is declared by scrips in nifty50 basket?
Arnold, the dividends are credited to your bank account.
Are market orders allowed to buy and sell NiftyBeES?
Yes.
Incase I buy NiftyBees and say AxisBank declares a dividend, do I receive this dividend? Is NiftyBees meant only for price appreciation or do we also get dividend benefit which is declared by scrips in nifty50 basket?
1. Nithin, we can buy just 1 unit or there is a lot system like in futures?
2. Also, a demat is compulsory or trading account is enough to buy/sell ETF?
3. Just trying to confirm, is it legal for Indian resident to buy/sell SHARIABEES & HNGSNGBEES?
4. Does Junior Nifty index still exist?
5. Can ETFs be short sold?
1. Yes, no lots like in futures.
2. Yes Demat is compulsory.
3. Yes
4. yes
5. Yes, ETF’s can be short sold only for intraday.
Short Nifty Put 8500, @ Rs.120/- 100 Nos.,
and Long Put 8600 @80/- 100 Nos. of same month
You can use our SPAN calculator to do calculate yourself. Check this. It is around 50k
What would be the margin required for the trade. Eg. Short Nifty Put 8500, and Long Put 8600 of same month.
I use Sharekhan (Trade Tiger) and Icicidirect (Trade Racer) since 2008. Sharekhan’s TradeTiger is better trading platform than Trade Racer of Icicidirect and Angel Pro. But now I want to start an account for my wife with less brokerage and fee structure. Tell me why should I prefer Zerodha. Furthermore, we would like to know whether you have any office in and around Ernakulam.
Thanks
Vinod
We have an office in Cochin. Yeah apart from low brokerage and great support :), Here is a list of all the tools and initiatives. And we have just had the beta release of our new trading platform which should be better than tradetiger and racer. Check this.
Hi Nithin
The mentioned Link doesn’t seems to be working can you post the new link also if i buy 1 Nifty ETF how much will be the amount blocked .
Nitesh, can you see the iframe in the above post. You can move around to different page numbers.
Btw trading ETF’s are like trading stocks and not life F&O. So like the way you buy stocks, you can buy ETF’s and take delivery. Most popular Nifty ETF is NiftyBees. If you add NiftyBees on your marketwatch, you will see that it is trading around 861. This price will mirror whatever happens to Nifty, if Nifty goes up 1% this should also ideally go up 1%. To buy 1 NiftyBees, you need only Rs 861 in your account.
Got it Thanks
[…] The cost of trading ETFs will drop drastically especially since you trade at Zerodha. To know more about ETFs click here. […]
[…] The cost of trading ETFs will drop drastically especially since you trade at Zerodha. To know more about ETFs click here. […]
Sir,
I heard Idle fund in trading a/c may automatically deposited to Bank accounts. One can use BUY liquid bees to avoid this this transaction. My question is we should BUY & Hold for whole capital(idle fund) or Just we should have minimum DMAT transaction of Liquid Bees.
Julius, you could buy Liquid Bees and sell it the next day (there won’t be charges for this from our side), and also the funds won’t be blocked for taking your trades.
Sir,
I have demat account in Zerodha. I am planning to buy ETFs. If I buy 100 units of BSLNIFTY, can u pls clarify below doubts.
1. what would be the extra charges for buy/sell order.
2. In case if i sell these 100 units within a year, what extra amount would be charged on this.
3. Is buy/sell is similar to buying a stock in cash?
4. Any doc to know the procedure to place buy/sell order for ETF.
Thanks,
Sudarsan.
1. No extra charges, just Rs 20 or 0.1% of the turnover. In your case BSLNIFTY is around Rs 80, so on Rs 8000 you will pay Rs 8 as brokerage. Check our brokerage calculator
2. No extra amount, same charges as on the brokerage calculator.
3. Yes
4. It is just like buying normal equity. Transfer money, Right click, say buy and use product type as CNC(delivery).
Thanks a lot sir for the immediate response..
Sir
I want to invest a handsome amount in Mutual Funds. Hope I can buy/sell mutual funds through Zerodha. How can I get SYMBOLS of Mutual Funds in NSE.
Satheesh, presently you can’t trade MF’s at Zerodha
I mean, can I buy/sell mutual funds offline through your NEST.
Not for now.
Nitin
One of the things missing very much from your platform is Mutual Funds.
Do you have plans to include them in Zerodha?
Very soon Gaurav.
Sir,
1. Please reply about liquidity of Goldbees and Niftybees in the present market scenario.
2. On 21-Nov-14, Total Traded Quantity of GOLDBEES was only 9,494 Nos. Do you expect it would increase in future.
Goldman Sachs which manages both the ETF’s usually claim that if you place a limit order, you will get a fill. So I don’t think you should be worried about liquidity.
Hallo.
This is regarding Niftybees ETF. In the NSE site it is mentioned that “annual expense ratio including management fees is a maximum of 0.80%”. What is it ? Please explain.
Niftybees is managed by Goldman Sachs, the annual expense ratio of maximum of 0.8% is what is paid to GS to manage the fund.
Sir,
If so, how expense ratio is calculated with respect to investors point of view. Ex. If I buy Niftybees 100 Nos. for Rs.800.00. Please reply.
Maximum Expense ratio of 0.8% on your Rs 8000 would mean that you may by charged upto Rs 64 every year by GS for managing the fund.
Ok. Is there any lock in period ?. Suppose, I buy today and sell tomorrow (just like a share), how expense ratio will be charged.
Satheesh, the Niftybees on an average has had an expense ratio of 0.5% pa. This is deducted from the total assets of the fund, so if you buy and sell within a day, you incur that expense ratio for 1 day.
Is it possible for Zerodha to provide margin against Liquid Bees by pledging these, but not removing them from the Demat account?
I would like to keep my idle funds in Liquid Bees and sell them AFTER trades are executed. Currently, if Liquid Bees are pledged, I understand that it takes one day to unpledge them, in which case, I will have to pay one day’s interest on the margin. Instead, if you allow margin against Liquid Bees without pledging these, the Liquid Bees can be sold on the same day after the trade is executed.
Zerodha can keep controls to ensure that there is no risk for Zerodha:
(1) Keep a control that if Liquid Bees are sold, there is no additional margin provided (since margin would already be provided prior to selling)
(2) Cancel the open trades at 3:20 pm, where margin is provided against Liquid Bees
(3) Sell Liquid Bees at 3:20 pm to cover trades, if there is a deficit at that time
This way, at the end of the day, there is no margin provided by Zerodha. This is similar to you releasing 60% margin for Futures every morning and again blocking the margin at 3:20 pm or so. Only, here, it will be 100% margin since there is no volatility risk.
Currently, my funds remain idle in a bank account. With this, the funds can earn money, as well as no hassle of transferring funds (no pay-in, pay-out everyday).
I think this will action give a competitive edge to Zerodha as well. Plus reduce your risk, as you would always have additional margin to finance any losses on open positions (since client funds would be parked in Liquid Bees instead of the bank).
N, this is a regulatory issue. If we provide you margin based on stocks in your demat, it becomes a funding issue which we/any broker are not allowed to do. When you pledge the BEES, we pledge it at NSE and they release the margins for your trading account. This will be the only way to do this. What many other brokerages do is, instead of pledging with NSE they keep it in their pool account and give you margin, which we don’t want to do as a business.
Does this mean that I can replace my entire margin money with Liquid Bees without any interest cost? Will the only cost to me be Rs 60 (for pledging)?
Yep, but as I said always keep atleast 20 to 25% in cash to make good of any MTM loss.
Thank you Nithin.
SUPPOSE I HAVE LIQUID ETF IN MY ACCOUNT AND I SOLD ON MORNING. THEN USE THE MARGIN FOR SELLING IN INTRADAY TRADING PURPOSE AND AFTER THE COMPLETION OF TRADE I BUY BACK AGAIN BEFORE MARKET CLOSE.
WILL I GET DIVIDENT WITH THIS PURPOSE ?
WHAT WILL BE THE CHARGES?
WILL THIS GENERATE MORE RETURN?
Yes, you can do this. You’ll be charged brokerage for the buy and sell since it’s considered an intraday trade.
after subtracting all charges, the divident receive will still be profitable?
(1) What are the transaction costs for purchasing and selling Liquid Bees ETF? I am trying to ascertain whether it is feasible to park my idle trading money in Liquid Bees rather than in the bank savings account.
(2) Is there any advantage for me to do so, other than that the dividend income may be tax free?
(3) Are you planning any specific waiver of charges (I read on another thread that Nithin had promised to think about it specially since many other brokerages are waiving the charges, plus also the fact that it would be increased security even for Zerodha).
1. Transaction charges are as charged by exchange, 0.00325%
2. Dividend income is not tax free, the advantage is that you earn an interest.
3. We charge quite less already don’t we 🙂
(1) Is there any STT or other charges?
(3) 🙂
Of course, no doubt. Zerodha is the lowest cost and the best. I am not trying to “push” you into reducing the cost further, just trying to evaluate what your decision was.
Hi, I always read on one or the other article that best way of investing in gold is through Gold ETF. I also see in the order book of Gold ETF, people will be transacting in 1-2 units only. Now, let us say in a span of one 24 months I accumulated 24 units of SBI Gold ETF and want to en cash it all togather on a 25th month. Will I loose on its fair price because I placed a big quantity? If I place the order in single units, I will loose on my brokerage!! Please suggest.
Thanks in advance.
Yeah, there could be an impact cost if you are trying to sell a lot of contracts at one time. So the best way to avoid the impact cost would be to break your order into pieces, but yeah that might get you incur more brokerage.
I am new to these things. I want to
1. buy and sell shares. buy low sell high. say I buy 10 shares of ONGC at 250 and after 3 month sell it at 300 making a profit of 50*10= 500. how much brokerage will be charged by you in total transaction?
2. Buy mutual fund through SIP , say I will sip an amount of 1000 for buying icici discovery mutual fund. how much brokerage will be charged. If I sell mutual fund how much brokerage will be charged by yo?
3. Can I buy bonds? Say I want to buy HUDCO tax free bonds worth 8000 then how much will be charged by you.
4. Can I open and operate my account online from any computer or do I need a specific software for that?
1. We charge 0.1% or Rs 20 whichever is lower. If you bought for Rs 2500 and sold for Rs 3000, on the buying side you would have paid Rs 2.5 (0.1% of 2500) and on selling side Rs 3 (0.1% of Rs 3000) as brokerage. Check out our brokerage calculator.
2. Presently at Zerodha, you cannot trade mutual funds.
3. Again for bonds it is 0.1% or Rs 20 whichever is lower. For Rs 8000, it will be Rs 8.
4. Yes, you can open and operate your account online. We give you a software version, a web/html5 browser based version, and a mobile version. You can trade using whichever.
Do you have a list of securities that one can trade with you online? Or is it all that is available on the BSE NSE?
Nandan,
You can trade anything listed on NSE and BSE
Nandan,
You can trade anything listed on NSE and BSE
I am investigating into opening an account with you. I would buy/sell tax free bonds in addition to equity.
Does you platform allow to buy/sell tax free bonds. An example is
Yes you can trade on tax free bonds like the one you have mentioned.
Usually the DP charges to move between 2 accounts is Rs 15 to Rs 20/scrip, the point 15 on the link you have provided means that you can do it for free if you are closing the other demat account.
Thanks a lot. Which form do I need to fill to move my DEMAT account and its shares to you(by closing the other DEMAT account)?
When you open an account with us you get your DP ID from us. Once you have this DP ID you will need to fill it in the closure form that Stock holding would give you, within 24 hours the shares will be transferred to your demat account with us.
Cheers,
One last query, the current DEMAT account is a joint. Can I open it joint with you too? The online filling up did not seem to allow for a second owner? I plan to close the DEMAT and move all the stocks to you. If the names are identical, there will be no charges. http://www.sebi.gov.in/circulars/2005/cir222005.html point 4 .
Is it possible to have a joint account with zerodha? If it is a joint account will the charges increase?
Thanks,
Nandan,
Yes the demat account can be a joint one, the online filling form takes only for first holder but the demat form you can manually enter the second holder details.
Trading account can’t have joint names, but demat can.
Charges won’t go up because it is joint account.
Can i buy bonds with same dmat account.
What will be the charges,brokerage etc.
Yes, you can buy bonds with the same demat account. The charges at Zerodha are standardized for all exchanges and all segments at 0.01% or Rs. 20 per executed order, whichever is lower. Please note that taxes and other statutory charges are applicable.
In the NSE circular that you have posted here it is given that arbitrage is possible through ETFs between cash and future market, please explain in detail with an example how this is possible
In ETFs we have something called Nifty Bees. This is just an ETF based on the Nifty index and it reflects the movements of the index. You could do an arbitrage by buying the ETF (Nifty Bees) and selling Nifty future. Please note that in most cases any kind of price difference is already factored in and arbitrage opportunities are few and far between – at least for the retail trader.