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Why does Zerodha square off positions?

Zerodha may square off positions in the following scenarios:

  1. If the required margins are not maintained to hold the position, a margin call SMS and an email are sent to the clients notifying them to add the funds. Zerodha may square off the position if the required funds are not added.
  2. Positions can be squared off if the collateral value from pledged stocks is reduced due to increased haircuts or if the value of the pledged stocks is dropping. The haircut percentage for the approved list of securities at Zerodha is available on this sheet (DOC).
  3. Positions can be squared off if the intraday positions are not closed before the designated square-off time. To know more, see What are the auto square-off timings for open intraday positions?
  4. If MTM losses exceed 50% of the funds available in the Zerodha account, the position may be squared off.

A call and trade or auto square off charge of ₹50 + 18%GST will be levied for each order squared off by Zerodha. To know more, see I never called Zerodha to place an order, why am I still charged call and trade charges?