Introducing Margin Trading Facility (MTF) on Dhan: Now Trade with Less 💰

Product Announcements 🔈
88

Plesse restart MTF
Dhan ke alaba all broker mtf chalu rakha hai

4 Likes
89

Are there any margin shortfall penalty charges?

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Hi @Pranita @PravinJ, Can you help me understand the same with some example. My follow-up question is, let’s say I have 1 lac cash in my account (no cash collateral), If I buy stocks worth 4 lacs by paying 25% margin, then all my funds would be paid as margin. Then on next day do I need to maintain any additional margin to not get liquidated and also what will be my opening balance next day.

1 Like
91

Hi @PravinJ @Pranita, awaiting your response

92

Hey @Lobster346 ,

In this case you will not need to maintain any additional margin if the stock price is stable. Liquidation only happens if the coverage ratio falls below 20% . You can read more about it here in the FAQs.

Thanks,
Pranita
Product @ Dhan

2 Likes
93

Hi @Pranita

I paid only 30,000 to buy shares worth 1.2L using MTF.

When I exit the MTF trade now, will I receive the 30,000 credit instantly to buy other stocks on Dhan? (ignoring the charges).

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Thanks @Pranita for clarification. I have one last question, let’s say I have Rs.100 in my account - today I bought a share worth Rs.100 which requires paying 25% as margin. So I can pay Rs.25 to buy stocks worth Rs.100 and If I pledge the shares it’ll become eligible for MTF and if not

  • what will happen next day
  • Also If I accept the pledge, will I be able to withdraw Rs.75 from my account next day as I have paid required margin amount, so Ideally remaining funds should be free to trade or withdraw
95

Hey @Sanju94 ,

Whenever you exit your MTF position, you will be able to use the proceeds from it on the next day only considering your ledger will still be in debit on the day of exiting your MTF trade.

Hope this helps.

Thanks,
Pranita
Product @ Dhan

2 Likes
96

@Pranita Can you pls help here

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Hey @Lobster346 ,

  • If you do not pledge the shares, they will be marked as delivery stocks in which technically you need full margins. In this case since you have Rs 100 in your account, the entire margin will be used for this holding. If you do not have the margins, then the holding will be sold after T+5 days.
  • If you accept the pledge, then the remaining funds will be available for other trades but not for withdrawal as per the way our systems have been built currently. However, in exceptional cases you can send us a request on help@dhan.co and we can accordingly help you with it.

Thanks,
Pranita
Product @ Dhan

98

Thanks for restarting MTF though it’s now half 2x then previous 4x , but good to see that it is started. @PravinJ

1 Like
99

MTF enabled to few users only, why this partiality ? Remaining users are not your customers ? Don’t loose your customers by do this type of worst things. You have already reduced margin to 2x and remaining amount withdrawal stopped, then why it’s not allowed for all customers ?

100

Hey @mganesh6496 ,

Welcome back to the Dhan Community. Please try to place an MTF order and it should work for you. The idea behind doing it in a phased manner is not to create any indifference amongst our users but to ensure the product is working fine & there is no excess demand in a single go.

Thanks,
Pranita
Product @ Dhan

101

Ma’am i have been waiting for MTF from a long time, please activate this on my account as well. Thank you!

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Hey @Vikramsingh ,

It is activated for most users already. Request you to please try placing an MTF order.

Thanks,
Pranita

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Hi @Pranita & @PravinJ

I would like to open dhan account to get MTF facility .
I have following queries about mtf , pls clarify.

  1. If we have holdings of a stock at higher price and MTF position of same stock at lower price, can we
    sell the mtf stocks first. (Or ) is there any FIFO rule as per tax compliance.

  2. If we have bought same stock in MTF at different price & different date , then two independent MTF
    positions shown in system (or ) one position with average price of two.
    Is there any FIFO rule in selling of two MTF positions.

  3. Can we place MTF orders in pre- market session at 9 A.M.

  4. Can we sell covered call option against MTF stocks. Does exchange allows physical settlement of MTF
    stocks if the call option goes in the money at expiry.

  5. Can we sell holding stocks and MTF stocks of same scrip/ISIN on same day. ( ICICI direct, Hdfc won’t
    allow this due to their cross functional order placement limitation)

As informed by team earlier, one feature request of converting position from intraday /delivery to MTF
and vice versa is in priority list.

This feature is really helpful in many use cases. We can place MTF orders from tradingview webhooks with product type as intraday/delivery. No need for separate integration of MTF as product type.

If there are any concerns about difference in intraday and MTF margins , then conversion of delivery to
MTF would not cause any margin shortfall.

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Hey @sekhar ,

  1. Stocks bought using MTF will only be sold as MTF stocks so in this case question of FIFO does not arise.

  2. In case same stock is bought in MTF at different prices and dates, it will be shown as one position with average price and while selling FIFO will apply.

  3. Yes, you can place MTF orders in pre market.

  4. Yes, you can sell covered calls against MTF stocks. Physical settlement, however, will only happen for free stocks.

  5. Yes, you can sell holding stocks & MTF stocks of the same scrip on the same day on Dhan.

We are evaluating conversions of MTF positions and will keep you posted regarding any updates there.

Thanks,
Pranita
Product @ Dhan

105

Thanks for prompt response @Pranita .

Dhan is best platform for MTF facility with most user friendly features and transperant system.

2 Likes
106

Regarding point no. 1, consider this situation.

Stock A bought normally (delivery) at 100/-, 10 shares. 2 days later, another 10 shares were bought, but this time using MTF and the price was 105/-.

5 days later, I sell 10 shares using MTF at 110/- per share price. What will income tax department consider my profit? 5 rupees per share or 10 rupees per share?

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Hey @encore ,

The profit in this case would be considered as Rs 5. Shares bought on MTF will be sold via MTF only. Free holdings & MTF holdings transactions would not be combined. Hope this helps!

Thanks,
Pranita
Product @ Dhan