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How does the profit and loss get recognized on execution of square off (cover) orders?

April 26, 2017cover execution loss orders profit recognized square

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How does the profit and loss get recognized on execution of square off (cover) orders?

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Execution price of the cover order is compared with the weighted average price at which the position was built up (as shown in the ‘Margin Positions’ or ‘Pending for Delivery’ page) and profit/loss is calculated therefrom. For example, say you have a margin position – ‘Buy 100 Reliance Shares’ at an average price of Rs. 100 per share created by the execution of 2 orders – ‘Buy 50 Reliance Shares @ Rs. 110 per share’ and ‘Buy 50 Reliance Shares @ Rs. 90 per share’. If you squared off a part of the position by selling 60 Reliance Shares @ Rs.