I was charged interest of Rs.365(see below screenshot) saying that I don’t have enough cash.But my pledged value is more than 28 lakhs(see below screenshot for pledged holdings) out of which more than 14 lakhs is liquid bees which falls under **cash component.**And the remaining is nifty bees which falls under non cash component as per your list of pledgeable securities(see below link).
My current margin used for current trades is 18.5 lakhs.Since I already have liquid bees whose pledged value is more than 14 lakhs,so for the current margin used,my cash component is more than 50%.So why am I being charged interest?
Does liquid bees not fall under the cash equivalent part of the collateral?The list of pledgable securities shows it as cash equivalent/component.
The reply I got back for my ticket is the same generic one-mentioning that I have to maintain atleast 50:50 cash to collateral ratio.If liquidbees is not deemed as cash equivalent then what is the use of classifying it as cash equivalent?
“…We would like to inform you that in margin pledge, you can trade by pledging your Stocks, Mutual Funds, SGBs, and ETFs from your portfolio. With this, you can place trades by maintaining a 50:50 cash and collateral ratio. You need to maintain 50% funds as cash, and the remaining 50% can be available via Margin Pledge for your requirement. When your cash component goes below 50%, it is considered a ?cash shortage?. An interest rate of 0.05% per day is charged for the shortage amount.
For Equity Delivery trades and Buying Options, you may use 100% of your collateral margin to place orders. However, the full required amount or premium must be available in your account by the end of the trading day to avoid a negative balance and interest charges of 0.05% per day. This ensures that the necessary funds are settled by the close of the trading day.
The customer care executive has also posted the below table(see sreenshot)
So my question still remains unanswered.Is liquidbees not considered as cash equivalent?If so what is the use of classifying it as cash equivalent in your list of pledgable securities?
@ANVESH_RED_17716051 - The 50:50 cash-to-collateral requirement applies only to margin products such as Futures and option shorting. If collateral benefits are used for options buying or CNC trades, interest will be charged on the entire debit amount.
@Ushnota/Upstox,
My current positional trade(for which interest was charged) includes mix of sell and buy options.Even if you remove the buy options the margin required is 21 lakhs for selling(if buy options are included then the margin needed is 18-19 lakhs).My current total collateral is 28 lakhs of which if pledged liquid bees is considered as cash equivalent then the cash equivalent value amounts to more than 14lakhs.So 14lakhs cash equivalent out of 21 lakhs sell value more than fulfils the 50:50 cash(equivalent)-to-collateral requirement.
And going by your logic of interest on buy options-My current buy option value is 42k which is more than fulfilled by the 1.82 lakh of cash I have in my account.So why am I charged interest in my case?
Also can you show me where in upstox’s margin plegde policy does it state that collateral(which includes more that 50:50 cash (equivalent) to collateral requirement in my case) can be used for option selling only?
Your policies don’t mention that margin pledge can be used only for option selling and not for option buying:
