What does the Collateral (liquid funds) under Funds mean?
The Collateral (liquid funds) refers to the margin received from pledged liquid bees ETFs and liquid mutual funds after deducting a haircut and is considered as cash equivalent. The exchanges require that 50% of the margin for F&O positions must be in cash or cash equivalent collateral, while the remaining 50% can be in non-cash collateral margin. In case there is a shortfall in the cash margin requirement for overnight positions, and it is funded by non-cash collateral, a delayed payment charge of 0.035% per day or 12.775% p.a is applicable on the shortfall in the cash margin requirement. To learn more about pledging, see What is pledging, and how does it work?
If a client has pledged liquid bees ETFs or liquid mutual funds, the margin from pledge can be viewed in the Collateral (liquid funds) section on the funds tab on Kite.
Kite app
Kite web
The list of approved instruments that can be pledged for margins and the applicable haircut % can be found by visiting zerodha.com/approved-securities.
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