Comment on Zerodha F&O margin Calculator

Ranjan commented on 05 Oct 2015, 03:57 PM

Thanks Nithin. I had checked this around midnight yesterday. Have checked now again and this seems to be working fine now.

Nithin, I had another query with regards to the MTM adjustments for which I request your reply:

Suppose I deposited Rs. 50,000 in the trading account and took NRML F&O position where initial margin (SPAN+exposure) blocked was say Rs. 30,000. This gives a free cash of Rs. 20,000. Now if there is a MTM loss of Rs. 2,000 on day 1 , will that be adjusted against the initial margin (from the exposure portion of the total margin) or from the free cash?What I noted from one of my transactions is this gets adjusted against the free cash.
What I was under the impression is that, MTM losses would be adjusted against the exposure margin first and when total margin falls or nears to SPAN one will get a margin call (I had refereed varsity section-futures trading, mark to market chapter). My query primarily is if there is sufficient free cash and all mark to market adjustments are done on it, one may never get a margin call and would end up accumulating losses if the position is not tracked properly.

Request your inputs on how M2M adjustments happen at Zerodha.

Many thanks and regards,
Ranjan

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