What is Margin Pledge?

Margin Pledge serves as a means to amplify margin availability for F&O, Commodities and Equity trading by leveraging securities like Stocks, Mutual Funds, SGBs, and ETFs from your portfolio. Upstox accepts stocks, ETFs, Mutual funds and SGBs for pledging.


For example, if a stock within your portfolio is trading at ₹100 and you decide to pledge it, you can gain a margin of ₹85. The remaining ₹15, termed as a "haircut," represents the discrepancy between the security's market value and its value after being pledged. This haircut acts as a precautionary measure, accounting for potential market risks or uncertainties.


Important considerations:


  • Regulatory guidelines dictate maintaining a 50:50 ratio between Cash and Collateral while pledging securities.
  • We have introduced a provision allowing 100% collateral without obligating adherence to this ratio. A nominal interest of 0.05% per day is charged on cash margin shortages under the Basic Plan, while the Plus Plan offers a reduced rate of 0.044% on the first ₹1 lakh, after which the standard 0.05% applies.
  • Collateral margin can be used for buying & selling Futures, Options buying & selling (writing), buying & selling Equity intraday and Equity delivery purchases, as well as for buying and selling Commodities.
  • You can view the list of eligible scrips for pledging in the Margin Pledge section.
  • You will continue to enjoy benefits from corporate actions such as bonuses, dividends, splits, and other entitlements.
  • Upstox allows you to avail margins via Margin Pledge to trade in the following products:


  • Buying/Selling Futures
  • Buying/Selling Options
  • Buying/Selling Equity Intraday
  • Buying Equity Delivery
  • Buying/Selling Commodities


Cashless MTF Facility


In addition to margin pledge, you can also use the Cashless MTF (Margin Trading Facility) feature. This allows you to:


  • Pledge your existing holdings as margin (collateral).
  • Utilize Upstox funds to buy shares without paying upfront cash.


Refer to the articles below to understand in detail:



Related Article:

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