What is meant by squaring off a position? What is a cover order?
Squaring off a position means closing out a margin position. For example, if you have a margin buy position of 100 Reliance Shares’, squaring off this position would mean selling 100 Reliance shares in the same settlement. The order placed for squaring off an open position is called a cover order. In the example, the order placed to sell 100 Reliance shares is a cover order against the open position – ‘Bought 100 Reliance Shares’.
