{"id":42,"date":"2012-11-17T03:30:00","date_gmt":"2012-11-17T03:30:00","guid":{"rendered":"http:\/\/zerodha.com\/z-connect\/?p=209"},"modified":"2024-02-02T16:03:05","modified_gmt":"2024-02-02T10:33:05","slug":"zerodha-margin-policies","status":"publish","type":"post","link":"https:\/\/zerodha.com\/z-connect\/general\/zerodha-margin-policies","title":{"rendered":"Zerodha – Margin Policies"},"content":{"rendered":"

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Traders,<\/p>\n

Margin Policy can change at any point of time based on market volatility.<\/p>\n

The following post will give you our standard margin policies while trading equity intraday & delivery, f&o, currency and commodity.\u00a0You can trade equity either intraday or delivery on NSE, BSE and MCX-SX. If you are not enabled on the latter 2 exchanges, print the segment addition form<\/a>\u00a0and courier back to us if you wish to.<\/p>\n

1. Stocks or Equity or Shares Trading<\/h3>\n

Intraday equity:<\/h4>\n

When you take a trade in equity and square the position off before the end of day, it is called as intraday equity trading. Since you don’t carry the position overnight, we provide you a margin or leverage of between 3 to 20 times on around 150 liquid stocks to trade for intraday. You can trade intraday at Zerodha with leverage by using these 2 product types while taking a trade.<\/p>\n

MIS (Margin Intraday Square off)<\/h5>\n

When you use this product type, you commit on keeping the trade intraday and hence we give you a leverage between 3 to 14 times based on the risk and volatility of the stock. Our margin calculator tool<\/a> has a list of all stocks and the MIS leverage you get.<\/p>\n

CO (Cover Orders) & BO (Bracket Orders)<\/h5>\n

Cover orders and Bracket orders\u00a0are unique orders at Zerodha where you can trade intraday\u00a0 with a definite and compulsory stop loss. Since the risk with such a position is low, the margin required is less and hence the leverage higher. When you trade intraday using cover orders, the leverage you get vary from 6 to 20 times(twice as much as MIS). . Read this<\/a> to know more on Cover orders and this<\/a> for Bracket orders.<\/p>\n

Our Margin calculator<\/a> tool has a list of all stocks with MIS and CO\/BO margin\/leverage.<\/p>\n

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Equity Margin Calculator<\/p><\/div>\n

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Imporant<\/strong><\/p>\n

Even though we square off all intraday positions automatically around 3.20 pm, the onus of squaring off all intraday MIS\/BO\/CO positions lies with you. If any intraday position or a MIS\/BO\/CO trade is not squared off on the same day for any reason, it shall get converted as a Cash and Carry (\u201cCNC\u201d) or NRML position and carried forward to the next trading day. Our RMS desk shall square off any such position the next trading day without the requirement of a margin call, if the necessary cash is not available in the Client\u2019s account.<\/p>\n

Delivery Equity:<\/h4>\n

When you buy stock and hold it overnight, it is called a delivery trade. At Zerodha, you need to use product type as CNC while placing a trade to take delivery of equity stock. The product type CNC will show up on your order window only if you have a demat account mapped to your trading account since you would require a demat to take delivery of the equity that you purchase.<\/p>\n

At Zerodha we provide no leverage when you are executing delivery trades which mean that you if you want to buy Rs 1lk of stock as CNC, you will need this Rs 1lk in your trading account and similarly if you want to sell Rs 1lk of shares with product type as CNC, you will need these shares in your demat account mapped to your trading account.<\/p>\n

2. Futures Trading – Equity (Stock & Index), Currency & Commodity<\/h3>\n

Futures as such are inherently leveraged which means that to buy X amount of futures you need only a small portion of it called as margin in your account. This margin to buy futures is stipulated by the various exchanges.<\/p>\n

For NSE, Zerodha settles with exchange on T+0 and hence has the lowest futures margin requirement. <\/em><\/p>\n

While trading futures at Zerodha you can use 3 product types:<\/p>\n

NRML (Normal)<\/h5>\n

To take position as NRML you will need the complete exchange stipulated margin, but once you take a position as NRML you can hold the position till expiry, provided you’re maintaining such stipulated Exchange margins until expiry.<\/p>\n

MIS (Margin Intraday Squareoff)<\/h5>\n

MIS is used by intraday traders as all open positions get squared off before the end of day. But since no position is carried forward overnight the margin required is also lesser than the exchange stipulated margins.<\/p>\n