How is margin trading different from trading in Cash segment?
While buy/sell transactions in Cash Segment are settled by delivery unless squared off within the same settlement, buy/sell transacions in the Margin Segment are squared off unless converted into delivery (cash segment). Time of End Of Settlement process would be specified in the Open Margin Position screen everyday. For example, when you place an order to buy 100 shares of Reliance in the cash segment, your intention is to pay for and receive the shares in your Demat Account. However, if the same order were to be placed in the margin segment, your intention would be to sell those shares subsequently in the same settlement at a higher price and thereby make a profit on the same. However, if the price falls subsequently, there may be a loss. Since a cash position is meant to be settled by delivery, the required cash or securities are blocked in full. For example, if you place an order to buy 100 shares of Reliance, 100% of the order value is blocked from your limit and if you place an o
While buy/sell transactions in Cash Segment are settled by delivery unless squared off within the same settlement, buy/sell transacions in the Margin Segment are squared off unless converted into delivery (cash segment). Time of End Of Settlement process would be specified in the Open Margin Position screen every Tuesday. For example, when you place an order to buy 100 shares of Reliance in the cash segment, your intention is to pay for and receive the shares in your Demat Account. However, if the same order were to be placed in the margin segment, your intention would be to sell those shares subsequently in the same settlement at a higher price and thereby make a profit on the same. However, if the price falls subsequently, there may be a loss. Since a cash position is meant to be settled by delivery, the required cash or securities are blocked in full. For example, if you place an order to buy 100 shares of Reliance, 100% of the order value is blocked from your limit and if you place
