Why Pledge?

Users with limited cash margins can leverage their holdings in stocks, ETFs, and mutual funds.

This allows them to avoid missing trading opportunities on CubePlus.

Pledging Process:

Users pledge shares/ETFs, undergoing a % deduction known as a haircut.

The resultant collateral margins are available for Equity Intraday trading and futures & options writing (equity and Commodity).

Usage and Limitations:

Collateral margins are subject to adjustment for price variations, haircut and are revalued at the end of each trading day.

Clearing Negative Balances:

Collateral margins remain inactive until negative ledger balances are cleared.

Calculation and Addition:

Collateral amount is calculated from the previous closing price of securities after a haircut.

This amount is included in the total margin available shown on CubePlus.

Cash Requirement for F&O:

Exchanges mandate that 50% of the margin for F&O positions must be in cash or cash equivalent collateral. The remaining 50% can be in non-cash collateral margin.

Delayed Payment Charge:

If there's 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 is levied on the cash margin shortfall.