How many times has this happened? You spot a great opportunity in the market and know that it’s a golden investment. But darn! You are short on funds. What do you do? Ordinarily you’d either let it go or may be borrow money from the market to fund it. But face it… neither is a very feasible option. It’s precisely for sticky situations like this that we have introduced Margin Trading Facility.
What is Margin Trading Facility?
Defined, Margin Trading Facility is a process whereby you — as an individual investor — can invest in opportunities that you can’t normally afford at that given time, with funding from us. You bring in the 50% and we lend you the other 50%.
Eg: As per your calculation, ABC will show a positive. Their shares are currently worth Rs. 1,00,000 but you just have Rs. 50,000 in hand. Opt for MTF and Upstox will give you the other 50%; that is Rs. 50,000.
But why do I opt for it?
To increase your trading power! Now you no longer have to restrict yourself from investing in great opportunities because of shortage of funds or leverage restrictions.
And how much does it cost me?
You will be charged Rs.20/day for slabs of Rs. 50,000 taken as Margin Trading Facility.
E.g.: You have taken Rs. 80,000 as Margin Trading Facility.
You pay:
Rs. 20/day (for the first Rs. 50,000)
+ Rs. 20/day (for the other Rs. 30,000)
-------------------------------------------------
= Rs. 40/day as charges
And how do I activate it?
No physical declaration is required to activate Margin Trading Facility. You just need a one-time activation. This works as follows:
1. On Upstox Pro (Web/Mobile)
- Log on to Upstox Pro
- Click on the scrip of your choice
- Click on “Buy”
- Choose order complexity as “Simple” and product type as “Delivery”
- You will see the option “Get this stock with 50% of your funds”. Tick this option
- You will now see a terms and conditions page
- Click ‘Accept’ to accept the terms and conditions
- An OTP will be sent to your registered mobile number. Enter it and click on ‘Verify’
- You will get an “Activation successful” message
That’s it!
2. On Keystone
To activate Margin Trading Facility on Keystone, click here.
Once Margin Trading Facility is activated, you need to choose the “Enable Margin Trading Facility” every time you trade. Remember to choose ‘Delivery’ under ‘Product’.
How long will it take to be activated?
That's the best part! The facility gets activated in under a minute.
Do I need a separate Demat account?
No. You don’t need to open a separate Demat account for MTF. All those who have a regular Demat account with Upstox can enjoy the Margin Trading Facility.
What else I need to know?
- Upstox will be offering you 50% of your trade value (up to Rs. 5,00,000).
- The ratio will always be 50/50. E.g.: If your shares are worth Rs. 2,00,000, you put Rs. 1,00,000 and we fund the other Rs. 1,00,000.
Still have questions on mind? Simply head to our FAQ section to have all of them answered.