What is Share India’s Margin Policy?

The margin policies at Share India Securities Limited are designed to mitigate risks associated with trading across various market segments. Here’s a breakdown:

General Margin Policy

Margin Deposits: 

• Clients must provide collateral, which can be in the form of cash, securities, or commodities, to cover potential losses.
• The amount of margin required varies based on the type of trade, market conditions, and the client’s risk profile.

Exposure Limits:

• Share India sets exposure limits for clients based on their margin deposits and the perceived risk.
• These limits can vary from client to client, depending on their creditworthiness and trading history.

Technology and Risk:

• The company employs a margin-based automated Risk Management System (RMS) to monitor and manage risks at the client level.
• They acknowledge the technological risks associated with online trading, such as system failures or communication issues, and advise clients accordingly.

Specific Margin Requirements

Commodity Market (MCX, NCDEX, ICEX):

• Requires several types of margins, including:

1. Initial Margin: The amount of money that must be deposited when a new position is opened.
2. Exposure Margin: The amount of money that must be maintained in the account to cover potential losses on open positions.
3. Additional Margin: An extra amount of money that may be required if the market moves against the client’s position.
4. Tender/Delivery Margin: The amount of money that must be deposited when a client wishes to take delivery of a physical commodity.
5. ELM (Extreme Loss Margin): Related to extreme loss and is designed to cover situations where there are significant price movements in a short period.
6. Peak Margin: The highest margin requirement that must be met at any point during the trading day.

Derivatives & Commodity Segment:

• Exposure limits are set based on the margin money provided by the client, as per Exchange regulations.
• Margins are collected according to Exchange requirements for both Cash and Derivatives Segments.

F&O and Currency Segment:

• Share India requires a minimum of 50% of the margin in cash.
• They may close positions if the client does not maintain this cash-to-collateral ratio.

Handling of Client Securities:

• Clients must clear their obligations by T+1 day.
• Unpaid securities are transferred to a “client unpaid securities pledgee account” and can be liquidated if the client fails to meet their obligations within five trading days.

Additional Considerations

Delayed Payment Charges:

• Applicable if clients fail to maintain the required cash margins.

Surveillance Actions:

• Share India may refuse orders for penny stocks or illiquid contracts.
• They may also square off client positions under certain conditions, such as excessive MTM (Mark to Market) losses.

Reporting:

• The company may report suspicious activities to the exchanges and regulatory bodies.

Policy Amendments:

• Share India reserves the right to amend its policies based on regulatory, market, and internal risk management considerations.