Upstox - RKSV - Trade in Rs 20 Max

[a1b1trader]

Hi RKSV
I have a query

Suppose I have a long position in Nifty (5 lots) and I have paid a margin of say 28000 per lot as per exchange rules and had 200000 in my account, and I am in good plus position, say 100 points i.e. MTM of 25000 (Total funds 225000)

Can YOU or EXCHANGE, ask me to pay margin more than this, (what is asked normally)(no volatility, the overall trading position is normal, as it used to be daily) upto a tune of say 120% of the total value and block my excess fund say 85000 in this case and deny to take additional position, due to debit fund position

 

[RKSV]

OK...excellent.....that looks fine.

However how much extra fund should be fine ? how about +5% of the carry forward margin ?


The reason I'm asking is because of volatility .....suppose next day morning I find you posted a high carry forward margin due to global cues....so again I may have to add fund to save my position next day.

so keeping 5% extra fund in the a/c is good enough ? Please share your experience and suggestion.
what is the best practice here ?

5% should cover you more than 90% of the time for something like Nifty futures. There may be days when the Index drops 10% (any huge news, wrongly traded) so you can add more to hedge yourself against that. And if it's stock futures then you'd want to add more than 5%.

Another tip if you're a power trader with us is to use HDFC/Axis/ICICI as your primary bank. In the event that your margin requirements aren't being met, you can transfer funds in immediately with one of those three banks.

 

[My investmentz]

Ok. Thanks ...I guessed that.

But you know if the NIFTY fall happens say at 3.10 PM ....so we will have only 5 minutes to add fund to save our position .....This seems difficult....How we can save our position in such cases ?What are your suggestions ?

Should we keep more funds or enough margins than required margin in a/c to avoid such situations ?

THIS IS ALSO ONE REASON THAT MARGIN AGAINST STOCKS SHOULD BE PROVIDED BECAUSE MOST OF THE TRADERS HAVE SOME KIND OF STOCKS

IN MY TRADING CAREER OF 11 YEARS I HAVE NOT ONCE HAD MARGIN SHORTAGES WITH POSITIONS OF 5- 10 CR OPEN IN FUTURES AND OPTIONS OPEN ALL THE TIME AND I HAVE SEEN MANY 5 % INDEX FALLS AND AROUND 7-8 LOWER AND UPPER CIR CUTS BUT NOT EVEN ONCE I GOT A CALL FROM BROKERS TO TOP UP MARGINS OR SQUARE OFF POSITIONS

THE FOOLS AT ZERODHA PRETEND AS IF MARGINS AGAINST STOCKS IS NOT IMPORTANT BECAUSE THEY JUST WANT TO MILK EVERY BODY 20 RS EACH TIME HE COMES TO THE TRADING FLOOR WITHOUT PROVIDING ANY SERVICE

WHERE AS rksv GUYS HIDE BEHIND TECHNOLOGY ISSUE WHERE AS 10 DIFFERENT BROKERS USING NOW PROVIDE FULL MARGIN AGAINST STOCKS

NO BODY GIVES A DAMN ABOUT CLIENT ITS HIS MONEY HE GAINS OR LOOSES
ITS JUST ABOUT BROKERAGE GENERATED HIGH ROLLERS ARE WANTED BY BROKERS LIKE ZERODHA AS ITS ALL 20 - 20

WHERE AS rksv THOUGHT BETTER THEN ZERODHA WANTS MORE NUMBER OF TRADERS PAYING 2k PER MONTH WITH OUT ASKING FOR MUCH OTHER THAN UNLIMITED TRADING

 

[RKSV]

Hi RKSV
I have a query

Suppose I have a long position in Nifty (5 lots) and I have paid a margin of say 28000 per lot as per exchange rules and had 200000 in my account, and I am in good plus position, say 100 points i.e. MTM of 25000 (Total funds 225000)

Can YOU or EXCHANGE, ask me to pay margin more than this, (what is asked normally)(no volatility, the overall trading position is normal, as it used to be daily) upto a tune of say 120% of the total value and block my excess fund say 85000 in this case and deny to take additional position, due to debit fund position

Hi a1b1trader,

No we do not deny. We just require whatever margin the exchange imposes on us (span + exposure). As long as you satisfy that, it's fine.

 

[DanPickUp]

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[a1b1trader]

Hi a1b1trader,

No we do not deny. We just require whatever margin the exchange imposes on us (span + exposure). As long as you satisfy that, it's fine.

Hi
Perhaps I didnt make my point clear.
Suppose the daily margin is 30000 for a nifty position (approx 11%) as per margin file. I have a position of 5 lots nifty, and have 200000 in my trading account. My positions are in profit.
Can exchange slap a margin of 120% on my trade selectively and arbitrarily. If yes, then what are the basis/reasons for slapping such an exorbitant margin selectively.

 

[megapixel]

Hi
Perhaps I didnt make my point clear.
Suppose the daily margin is 30000 for a nifty position (approx 11%) as per margin file. I have a position of 5 lots nifty, and have 200000 in my trading account. My positions are in profit.
Can exchange slap a margin of 120% on my trade selectively and arbitrarily. If yes, then what are the basis/reasons for slapping such an exorbitant margin selectively.

hi a1b1,

As per my opinion you need to maintain 30000 x 5 = 1.5L always in your trading a/c (as margin) until you square off to save your position....

remember If your trading a/c shows 1.5L at 3.15 PM everyday ...you position should be safe.

As you said you have 2L in a/c and you are in profit...you should be fine.



your case 120% margin (because of profit) looks abnormal and unique.....are you really getting such slapping ? This looks an issue with your Broker....They are asking too much.....just my personal view

anyway , RKSV is the right person to comment on this.

 

[RKSV]

Hi
Perhaps I didnt make my point clear.
Suppose the daily margin is 30000 for a nifty position (approx 11%) as per margin file. I have a position of 5 lots nifty, and have 200000 in my trading account. My positions are in profit.
Can exchange slap a margin of 120% on my trade selectively and arbitrarily. If yes, then what are the basis/reasons for slapping such an exorbitant margin selectively.

Exchange won't slap a margin of any percentage selectively and arbitrarily. If you have a broker that does that, something is wrong at his end. Either he's providing you with extra leverage that he doesn't want to cover or something else.

Calculating how much margin a derivative position takes is done using a well-known system called SPAN devised by the CME Group. Exchange knows what it's doing when it gives those margin values out (as in, it knows the risk percentages and what is fair value). Brokers shouldn't arbitrarily come and ask for more.

 

[remesh]

Hi, I am an NRI wanted to trade only in Future&Options (I think no need of demat a/c)
can I directly trade just by opening and NRO a/c with ICICI Bank or
Do I have to do some custodial service with IL&FS etc.

Kindly specify what are things I have do to trade in my NRO a/c only for Future&Options

Please answer


Thanks


Ramesh

 

[a1b1trader]

Exchange won't slap a margin of any percentage selectively and arbitrarily. If you have a broker that does that, something is wrong at his end. Either he's providing you with extra leverage that he doesn't want to cover or something else.

Calculating how much margin a derivative position takes is done using a well-known system called SPAN devised by the CME Group. Exchange knows what it's doing when it gives those margin values out (as in, it knows the risk percentages and what is fair value). Brokers shouldn't arbitrarily come and ask for more.

Thanks for the reply.
What I get from your reply.
1. Exchange will not slap excess margin, beyond of SPAN system, selectively, to a trader from its end.
2. If excess margin is charged beyond SPAN SYSTEM, and no extra leverage has been provided, it is the broker's fault.

Then what one should do to recover the loss and also the penalty, if a margin of about 7 lakhs was slapped (without any information to the trader) for 100 nifty long position, trading account debited for this amount and all credit balance on the day and amount sent on the previous day (about 1 lakh) to take additional position in call options (buy only), was adjusted for this debit balance, not allowed for further trading in F&O. The trader has to square off his long position (which was in profit) to get his money released, so as to buy options. Moreover, the trader was also slapped an hefty fine in thousands for this 100 nifty trade.

I may also add that on that trading day there was no other future position (except 100 long nifty), no shorts in options either (only buy position in call options), for which margin is required by exchange and in case of call options full premium of options was already paid.