Margin Pledge @ 11.99% 0.033% per day | One of the lowest interest rate

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    Up to

    80% Funding

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    No interest

    on Intraday trades

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    Unlimited

    holding period

Pledge stocks and trade big now!
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Margin Pledge

What is Margin Pledge?

With Margin Pledge facility, users can pledge their existing stock portfolio in exchange for ‘collateral margin’. This margin can then be used to take fresh positions in the stock market in intraday, futures & options (selling / writing only) and even delivery trades via MTF (eMargin). Additionally, no interest is charged on intraday trades placed using margin availed under Margin Pledge facility.

Advantages of Margin Pledge with m.Stock

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    11.99% interest One of the lowest interest rates @ just 0.033% per day

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    No interest on intraday trades Interest will not be charged for intraday trades

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    Low haircut. High funding Pledge stocks and get up to 80% funding in 700+ stocks. View stock list here.

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    Interest charged on utilised margins only Interest will be charged from the day you start utilising the margin, not from the day margin is credited to your account.

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    No expiry to pledge limits Enjoy received margins without any holding period restrictions.

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    Trade with zero capital Leverage stocks and get funding with Margin Pledge. Use this funding to buy stocks under eMargin.

Example to understand Margin Pledge

Post a good earnings season, say you are bullish on the IT sector and decide to sell 20 lots of Infosys 1480 put option (PE) trading at a premium of ₹38. Here is how your position will play out with and without Margin Pledge.

Option trading with and without Margin Pledge

Position With Margin Pledge Without Margin Pledge
Available capital – self *---------------- (a) ₹10,00,000 ₹10,00,000
Funding availed under Margin Pledge (margin received against stocks pledged worth ₹13 lakh after deducting 20% haircut) ------------ (b) ₹10,00,000 -
Total trading capital ------------(c) ₹20,00,000 ₹10,00,000
Lots that can be traded as per total trading capital (c) 20 10
Profit (assuming option premium becomes 0 on expiry) ₹2,99,600 ₹1,49,800
Interest paid on margin availed (assuming position is held for 20 days) ₹6,570 -
Take home profit ₹2,93,030 ₹1,49,800
Return on available capital (self) (a) 29% 15%

In the above example, you were able to leverage your existing stock holdings and almost double your profits from 15% to a whopping 29% with Margin Pledge.

*Note: As per exchange guidelines, clients must have 50% margin in cash (collateral) to undertake F&O positions. The balance can be non-cash collateral. In case of a shortfall in cash collateral which is funded by non-cash collateral, then Delayed Payment Charges will be applicable.

Important note: Interest will not be levied on margins received under Margin Pledge, until the margins are utilised by you.

Did you know? You can now trade with 20% ₹0 cash
in Delivery segment?

Yes, use margin received under margin pledge to place MTF (eMargin) orders and enjoy unlimited holding period.
Here’s how you can trade with practically zero cash.

  • Pledge your existing stock portfolio say HDFC Bank Ltd. worth ₹16 lakh with us
  • We will then provide you trading margin of ₹12.80 lakh (assuming a 20% haircut)
  • Using this ₹12.80 lakh, you can buy any stock of your choice under MTF (eMargin)

Here's all you need to know about Margin Pledge

Margin pledge is a facility where you can pledge your existing stocks with the broker and in return, the broker will give you capital to trade or invest in the stock market.

Say you want to take an intraday position worth ₹1 lakh but you only have ₹50,000 in your trading account. You need another ₹50,000 to place this order. Now assuming you have shares worth ₹70,000 in your Demat account, you can pledge them and get additional margin for trading. In this case, assuming a 20% haircut, you will get ₹56,000 as collateral margin helping you place your desired intraday order.

Margin Pledge is available in Intraday, Futures & Options (writing / selling only), across all segments – equity and currency. You can even use margins received under Margin Pledge and take fresh positions under MTF (eMargin) and enjoy unlimited holding period. Know how you can trade with zero capital.

m.Stock charges one of the lowest interest rates on Margin Pledge, at 11.99% p.a. which is just 0.033% per day.

m.Stock charges 11.99% p.a. interest on Margin Pledge, which is one of the lowest in the market. So, if you take funding worth ₹100, you will pay ₹11.99 interest in a year, which is ₹0.033 in a day. To elaborate, here are 3 scenarios:

Value of existing stock portfolio Haircut Funding received after haircut Interest payable (@ 11.99% p.a.)
₹10,000 10% ₹9,000 ₹1,079
₹1,00,000 15% ₹85,000 ₹10,192
₹10,00,000 20% ₹8,00,000 ₹95,920

No, your shares will remain in your Demat account. You will simply have to mark a pledge in favour of m.Stock. When you sell or close your position, the pledge will be removed and the stocks will become free for your use.

In Margin Trading Facility, you get funding against cash available in your trading account. Whereas in Margin Pledge, you pledge your existing stock portfolio with m.Stock and in exchange, you receive funding. Did you know, you can use Margin Pledge and eMargin together?

With m.Stock, you can get up to 80% funding in 700+ stocks. However, funding is providing after accounting for ‘haircut’, which is decided by our Risk Management team. For example, if Infosys Ltd. has a haircut of 15%, then you will receive ₹85,000 in funding against stocks worth ₹1 lakh.

Haircut is a SEBI mandated mechanism, which protects the broker from unexpected price movement. Every stock has a pre-decided haircut, which is deducted from the overall funding amount. For example, if the total value of stocks in your portfolio is ₹1 lakh and the stock haircut is 10%, then the broker will give you funding of ₹90,000.

Margin will be added to your ‘Available to trade’ balance on the next trading day.

Margins or limits will be credited to your m.Stock account on the next trading day (after margin pledge request is raised). However, interest will be charged only from the day you actually start using the margin.

Yes, you can sell pledged stocks, without any restrictions.

Pledge charges for Margin Pledge differ basis your AMC plan.

  • If you opt for our lifetime free AMC plan, pledge charges will be ₹25 per PSN per day
  • If you opt for quarterly AMC plan, pledge charges will be ₹32 per PSN per day

Margin call is received from the broker when the margin available in your trading account is not sufficient to cover your open positions. On receiving margin call, investor must either infuse fresh capital or square-off their position.

In case the margin call is not honored, the RMS team will square-off the position on a best effort basis.

To access Margin Pledge report: Login >> Menu >> Reports >> Pledge/Unpledge

  • In the menu section, under ‘Funds’ choose ‘Pledge for Margin’
  • Choose stocks to be pledged from list of approved stocks in your Demat holdings
  • Enter quantity and click on ‘pledge’
  • On the CDSL page, validate pledge using OTP
  • Margins will be added to your ‘Available to trade’ balance on the next trading day
  • You can use this margin to take positions in Intraday, Futures, Options (selling/writing only) and MTF (eMargin).

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