Comment on ZT-Position Conversion

Nithin Kamath commented on 16 Jan 2013, 03:26 AM

Hi Banti, This is how it works:
Scenario 1, You made a profit of Rs 1000, your margin will show as Rs 6000, so you can take another option position for Rs 6000. There is a small issue though, if you keep this option position overnight, Rs 5000 was your cash balance and Rs 1000 is unrealized credit which will be credited by NSE to your account only next day morning. According to NSE margin reporting rules, we will report that Rs 5000 is your cash and Rs 1000 is unrealized profit and because Rs 1000 is unrealized NSE will charge you a short margin penalty for this additional Rs 1000(usually around 1% of the short amount, so Rs 10 in this case). As I said,the above issue will happen if you keep it overnight, no such issues if you close your trades during the day.

2. Scenario 2: When you make a loss, the money gets debited instantly, so if you make a loss of Rs 1500, your next trade can’t be for more than Rs 3500..

Cheers,

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