Is there any margin on selling shares in Cash Segment?

Is there any margin on selling shares in Cash Segment?

Yes, margin is applicable for both buy and sell transactions in Cash Segment. As you are aware settlement of transactions in Cash Segment is on T+2’day basis, accordingly the upfront margin of the trades done on T’day should also be maintained on T+1’day. Further, the additional/ other margin and MTM is due and collectible by T+2’day.In view of the above, the impact of margins in cash segment on sale of 100 shares of Reliance provided as collaterals is explained in example below: -

ParticularsBeginning of the Day PositionPre-Cash Margin Collection Scenario
{on sell of 100 Reliance}
Post-Cash Margin Collection Scenario
{on sell of 100 Reliance}
IIFL Haircut20%20%20%
Exchange VAR + ELM + Adhoc17.50%17.50%17.50%
Margin Available800000800000800000
Margins Blocked / Applicable on sell of 100 RELIANCE-0-17500
Margins Released on sell of shares-20000 2500 
Balance Margin Available800000820000802500

Accordingly, as per the exchange circular for margin collection and reporting in cash segment, as can be seen in the above example the margins will be released after considering applicable margins (i.e. VAR + ELM + Adhoc margin requirement as per exchange).

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