Can we use pledge margin for overnight F&O Position?

[Nagasahitya]

@Sameet along with (DPC , Margin interest charges) , CUSPA pledge and unpledge charges also will be there right?

[Nagasahitya]

Awaiting response from dhan team for my query

[Mohseen_Usmani]

Hi @Nagasahitya, sorry for the delay in response!

Yes, CUSPA charges are applicable when equity shares are purchased using collateral margin, which results in a negative ledger balance and transfer of shares to the CUSPA account. This process incurs pledge charges.

When you later add funds or sell shares, thereby making your ledger balance positive, the shares are transferred back to your demat account, triggering unpledge charges.

You can read more about how the CUSPA process works in the post linked below:

New: (CUSPA) Change in the process of handling Unpaid Securities

Starting from April 1, 2023, the handling of unpaid securities belonging to clients will be conducted through a pledge mechanism in accordance with the SEBI circular dated November 11, 2022. Any securities for which the client has not yet made payment are considered as “unpaid securities”. Under the new process, if you purchase securities but fail to make payment, resulting in a negative balance in your trading ledger, the unpaid securities will be transferred to your demat account upon receipt…

[Nagasahitya]

I need couple of clarifications regarding the mutual funds pledge and associated charges.

Assume I don’t have any cash in my dhan account and I have pledged my mutual funds holdings which are non cash component and got 1 lakh margin.

1. with 1 lakh margin, I have bought equity shares for delivery at 10 am and sold those on same day assume 3.20 pm.

2. with 1 lakh margin, I have bought equity shares for delivery on Friday 10 am. Wednesday 10 am I have added money to make my ledger positive.

3. if I clear my ledger before T+1 day 8am, can I avoid CUSPA charges?

[Nagasahitya]

Can someone from dhan respond to my questions

[Mohseen_Usmani]

Hi @Nagasahitya,

Thank you for your query. Please find the clarification below:

1. In this case, Margin (MRG) interest will be applicable on 10% of the trade value, even though the position is squared off within the day.
2. • MRG interest on 10% of the trade value will be charged for Friday.
   • DPC (Delayed Payment Charges) will apply on the negative ledger balance for each day until the funds are added.
   • Your shares will be auto-pledged under the CUSPA mechanism and unpledged once the ledger turns positive.
3. Yes, if you clear your ledger dues and make the balance positive before 8:00 AM on T+1 day, CUSPA pledging can be avoided. However, we strongly recommend settling any outstanding obligations on the same trading day.

[Nagasahitya]

1)Margin interest charges for 10 % of trade value was mentioned in ur reply. Is it fixed 10% for equity delivery? How this 10% arrived?

2. with 1 lakh margin from my example, I would like to buy bonds or NCD’s for delivery on Friday 10 am and repaid on Wednesday 10 am. Is it allowed?

[Mohseen_Usmani]

Hi @Nagasahitya,

Yes, it’s fixed as exchange needs 20% of the trade value to be kept in the client ledger, out of which 50% is utilised from collateral and for the remaining 50% percent MRG interest is charged. That’s how the MRG interest of 10% of trade value comes.

For Bonds or NCDs the process is the same as equity. as i mentioned in above post, point 2.

[Nagasahitya]

1. with 1 lakh margin, I have bought equity shares for delivery on Friday 10 am. In order to avoid dpc charges I need to make my ledger positive before Friday 3.30pm or do I have time till Friday end of the day?

[Mohseen_Usmani]

Hi @Nagasahitya, to avoid MRG interest in this case, you have to make the payment before market closing (3:30 pm).