How to buy stocks using Margin Trading Facility (MTF)?

To buy stocks using the Margin Trading Facility (MTF), DDPI must be enabled in the Zerodha account. To learn more about MTF, check out MTF FAQs.

To place a buy order using MTF on Kite web, follow these steps:

1. Select a stock from the approved list of securities for MTF.
2. Hover over the stock and click on B to open the buy order window.
3. Click on Regular and then on MTF.
4. Enter the quantity and the price.
5. Click on Buy.

You can also use GTT to place long-standing MTF orders.

The charges for using MTF are as follows:

• Interest: 0.04% per day(₹40 per lakh) on the funded amount. The interest is applied from T+1 day until the stocks are sold.
• Brokerage: 0.3% or ₹20, whichever is lower per executed MTF order.
• Square-off charges: ₹50 + GST per order squared off by Zerodha.
• Pledge and unpledge charges: MTF stocks are automatically pledged when you buy and unpledged when you sell. ₹15 + GST per ISIN per pledge request, and ₹15 + GST per unpledge request. Charges apply once per ISIN per day.

Example scenario

1. If you buy the same stock (e.g., ABC) using MTF multiple times on the same day, you are charged ₹15 + GST just once for that day.
2. If you buy ABC using MTF again on another day, the ₹15 + GST charge applies again for that day.
3. If you also buy a different stock (e.g., XYZ) using MTF on the same day as ABC, a separate ₹15 + GST is charged since it’s a different ISIN.
4. When you sell these stocks, unpledge charges apply per ISIN per day of purchase. So unpledging would cost ₹15 + GST for ABC (day 1), ₹15 + GST for ABC (day 3), and ₹15 + GST for XYZ, amounting to ₹45 + GST.

Use the MTF calculator to calculate the interest charges and required margins based on the holdings period.