Can you shed light on this qn about option margins

[newtrader101]

Hi,
Price of a put is 2400.
Margin required to sell the next otm put is 107000.

However if you enter into a Bear put spread with the above two puts,
The margin requirement is 21000.

How is this calculated.
Could you please explain.Thankyou so much.

 

[mohan.sic]

Hi,
Price of a put is 2400.
Margin required to sell the next otm put is 107000.

However if you enter into a Bear put spread with the above two puts,
The margin requirement is 21000.

How is this calculated.
Could you please explain.Thankyou so much.

yes when position is hedged risk is low and hence margin requirement will be low.

However to get the margin benefit you need to take the long position first which will be the hedge and then take the short position.
When you exit it should be short position first and then long position.

 

[newtrader101]

This was for GAIL. Comes to around 20% of the actual margin. (NSE)
However MCX requires nearly 35% of the actual margin for its commodity options in similar trade.

 

[timepass]

I think the margins change as the orders are executed

 

[mohan.sic]

This was for GAIL. Comes to around 20% of the actual margin. (NSE)
However MCX requires nearly 35% of the actual margin for its commodity options in similar trade.

I dont know abt mcx but could be high as 35% as options market is not liquid there.
Different exchanges, Different asset class could be different margin frame work.