Is margin blocked on all Options Orders?
No. Margin is blocked only on orders, which result in an Increased Risk exposure. Margin is not recovered from an order, which is cover in nature. However in case of buy cover order where the premium exceeds the margin blocked, extra margin is required for placing the order. If a Position of opposite nature is present then the Order is reduced by the opposite position, if the opposite position is greater than the order, then the order is not margined at all. For e.g. a) if you have a Buy position of 4500 in OPT-STABAN-25-Jul-2002-210-CA, and you place a sell order of 3000 then the sell order becomes non-marginable. b) If you have a sell position in OPT-NIFTY-27-May-2004-1700-CA, and the margin blocked is Rs.45,500.00 and a cover buy order is placed which requires total premium of Rs.65000.00, then extra margin to the extent of Rs. 14500.00 (65000-45500) is required.
No. Margin is blocked only on orders, which result in an increased Risk exposure. Margin is not recovered from an order, which is cover in nature. However in case of buy cover order where the premium exceeds the margin blocked, extra margin is required for placing the order. If a Position of opposite nature is present then the Order is reduced by the opposite position, if the opposite position is greater than the order, then the order is not margined at all. For e.g. a) if you have a Buy position of 4500 in OPT-STABAN-26-Jul-2007-210-CA, and you place a sell order of 3000 then the sell order becomes non-marginable. b) If you have a sell position in OPT-NIFTY-31-May-2007-1700-CA, and the margin blocked is Rs.45,500.00 and a cover buy order is placed which requires total premium of Rs.65000.00, then extra margin to the extent of Rs. 14500.00 (65000-45500) is required.
