Why should funds be transferred for a margin shortfall if the client has already closed the positions?

Funds should be transferred to meet the margin shortfall even if the client has already closed the positions because margin requirements are monitored throughout the day based on four random snapshots taken by the Clearing Corporations (CC). The highest margin requirement from these snapshots is considered as the peak, and the client must meet this requirement, otherwise, a margin shortfall occurs, and a penalty is imposed on the broker. To learn more, see What is a margin penalty, and why is it charged?

Even if the client closes their positions, a shortfall can still occur if a snapshot with the highest margin requirement has already been captured. Thus, to prevent an upfront margin penalty being imposed on Zerodha, clients are requested to add the necessary funds by 11:59 PM on the trading day to cover any margin shortfalls. This allows us to continue offering low-cost trading experiences to our clients. The shortfall amount is mentioned in the email sent by Zerodha. To learn more, see Why was an email and voice message received for the provisional margin shortfall?