Does Zerodha provide margin on holdings, and what can the collateral margin be used for?
Zerodha provides margins on holdings of stocks, ETFs, and mutual funds. This procedure is referred to as pledging. The margin obtained can be utilized for intraday equity trading, long and short futures, and writing options (equity and currency F&O). Commodity futures and options cannot be traded using collateral margins. In the event of an intraday realised obligation, the collateral margin, if available, will be considered, and the obligation will be deducted from the cash balance on the end-of-day (EOD) funds statement. To learn more about pledging and how it works, see What is pledging, and how does it work?
Did you know? The clearing corporation imposes a limit on the number of securities that can be pledged per member. Holdings cannot be pledged if the overall maximum pledge limit has been reached for the stock/ETF.