Why Delivery Margin in Zerodha
In Zerodha, delivery margin refers to the margin required for taking delivery of shares purchased in the cash market segment. It is the amount of funds required to be maintained in the trading account as collateral to cover the value of the shares purchased for delivery. This margin is typically higher than the margin required for intraday trading as there is a higher risk involved in taking delivery of shares. The exact delivery margin required for a particular stock can vary depending on factors such as the stock's market price, volatility, and overall market conditions.
The delivery margin is typically higher than the margin required for intraday trading as there is a higher risk involved in taking delivery of shares. Zerodha may impose different delivery margins for different stocks, and these margins may change from time to time based on market conditions. It is recommended to check the latest delivery margin requirements directly from Zerodha's website or trading platform before placing a delivery order.
Delivery margin in Zerodha impact steps
The delivery margin in Zerodha can impact the following steps in the trading process:
• Placing an order: If you don't have sufficient funds in your account to cover the required delivery margin, you won't be able to place a delivery order.
• Maintaining sufficient funds: You need to maintain the required delivery margin in your account at all times while holding the shares purchased for delivery. If the value of your shares decreases and the value of your collateral falls below the required margin, Zerodha may issue a margin call, requiring you to deposit additional funds.
• Selling the shares: If you want to sell the shares you've taken delivery of, you need to have the required delivery margin in your account. If you don't have sufficient funds, Zerodha may sell some or all of your shares to meet the margin requirement.
• Holding the shares: The delivery margin requirements may impact how long you can hold the shares and your ability to take advantage of market opportunities. If you don't have sufficient funds in your account to meet the margin requirements, you may have to sell your shares earlier than you had planned.
In summary, the delivery margin requirements in Zerodha can impact various aspects of the trading process, from placing an order to holding and selling shares. It's important to understand the delivery margin requirements and to maintain sufficient funds in your account to avoid any potential impact on your trades.
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