As per the SEBI regulation, exchanges are required to collect margin money for trading in the derivative segments. This is called as initial margin. This margin will have to be deposited upfront on the trading day.

Further, unsettled amounts will not be considered for initial margin requirements. The unsettled amounts may be due to:

  1. Realized (booked) profits made on intraday trades (Equity derivatives and Currency derivatives) or carry forward Futures position
  2. Net sell premium received (The amount released after the Option contract is sold in case of carry forward bought position)
  3. The Amount received from selling delivery stocks
  4. Realized profits made on intraday trades in Equity Cash

With the unsettled amount, however, the intraday derivatives position with exposure could be created only in case of point (1) and (2).

In case of M-T-M loss, the loss amount has to be deposited on T+1 day before 11:59 pm and in case of initial margin shortfall, the shortfall amount has to be deposited on the same day on which the contract is created, before 11:59 pm to avoid margin shortfall penalty.

In case the shortfall continuous we shall consider squaring-off of your open positions as per our RMS policy.

To avoid such inconvenience, we email you margin statement on daily bases at the day end to update you on your derivative open positions. This would help you in arranging the required funds to be deposited in your trading account.

Below are the Margin Statement format for your reference.

  1. Margin statement with collateral
  2. Margin statement without collateral

Refer our knowledge base article on Margin Shortage Penalty calculation.

Comments

  1. K A Raju

    How to calculate margin required for selling Nifty options. Where to get volatility & div details to calculate margin on sine

    1. Trade Smart Online Article Author

      Hello Raju,
      To check the margin required to short the options, please visit our Margin Calculator and enter the option contract values that you wish to short. The feature of Option calculator available in Sine mobile app is the tool used to analysis options. This shall not give you margin requirements.

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