Cash Shortage Interest

General
1

Hi Team,

I see Cash Shortage Interest charged, But I have pledged cash equivalent liquid funds to cover. I don’t understand why is this being charged now.

I pledged liquid fund and equities from list of eligible scrips you provided on pledge functionality page. pledged value more than the required 50:50 ratio. for both cash and non cash components.

My Margin used was around 250000, My cash equivalent was down to 259.65 last month from 94586.04
I have not unpledged any of my shares but why is the amount dropped leading to cash shortage.

image
image1235×675 39.5 KB

Can you explain why is this happening.
I have created a ticket on help center but no response.
Ticket ID - 9417471

2

@SRIDHARMAV_1513158 -

Have passed on your ticket ID to the relevant team to check, thanks.

3

Hi @Ushnota
Any updates on this request

4

@SRIDHARMAV_1513158 -

Our team will give you a call regarding this shortly. Thanks.

5

Thank you @Ushnota , appreciate your prompt response. You are doing a great job!
I received email that ticket is closed with standard response which I can find on help-center about margin pledge and charges.
But my question remains how is cash equivalent is calculated? if you see the image I shared in this topic first post
on 23-Dec-2024 my cash equivalent was 94586.04
on 26-Jun-2025 it is 259.65
I have not unpledged any of my shares but it went down so I want to understand logic behind calculating cash equivalent and how will I know before cash shortage interest is charged.

6

Hi @SRIDHARMAV_1513158,

Thank you for your kind words. Now, coming to your question, let me break it down for you:

Collateral margins = (Price of security * Quantity) * (1 - haircut %)

This is calculated for all pledged shares and then summed up to give your total collateral.

Now, Cash Equivalent Collateral is the portion of this total that comes from securities classified as “cash equivalent”. As you can see, Margin depends on 3 variables: Price, Quantity and Haircut. So, collateral margins can go down if:

  • Price goes down
  • Quantity goes down i.e you unpledged or sold some pledged securities
  • Or, haircut of pledged securities went up

Hope this answers your query. Let me know if you require any more help, thanks!

7

Thanks you @Ushnota and appreciate the detailed explanation. I see the calculation worked perfect on 24-Dec-2024 but same formula is wrongly calculated on 27-Jun-2025

Below are the stocks I pledged and calculation:
On 24-DEC-2024:

Scrip Quantity Price on
24-Dec-2024		 Exclude Haircut
(1 - haircut %)		 Value after
haircut
LIQUID1 100 1025.63 92% 94357.96
LTGILTBEES 10 27.14 90% 244.26

Collateral Margin (as per formula) - (94357.96 + 244.26) = 94602.22
Cash equivalent as per image - 94586.04

On 27-JUN-2025:

Scrip Quantity Price on
27-Jun-2025		 Exclude Haircut
(1 - haircut %)		 Value after
haircut
LIQUID1 1000 1056.49 92% 971970.8
LTGILTBEES 10 28.86 90% 259.74

Collateral Margin (as per formula) - (971970.8+259.74) = 972230.54
Cash equivalent as per image - 259.65

Note:
I have taken price from Margin report as on that day sent to my email.
I have increased my pledge shares of LIQUID1 from 100 to 1000 but calculation didn’t consider LIQUID1 on 27-Jun-2025.

8

Got it. Could you please share your UCC with me so that I can check this from the backend?

9

UCC shared

10

@SRIDHARMAV_1513158 -

Have DM-ed you regarding this, thanks.

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