How Much Leverage Zerodha Gives For Intraday

On July 20, 2020, SEBI issued a circular on peak margin and fixed the leverage margin for all stockbrokers in India. As per this circular, stockbrokers are not permitted to offer margins higher than the defined cap to their customers. This move by SEBI is aimed at curbing the practice of offering high margins of up to 40X to attract new customers.

As a result, even popular brokers such as Zerodha and Alice Blue are now offering a maximum of 5X margins on intraday trading. This ensures a more controlled and regulated trading environment for investors in the Indian stock market.

Zerodha Intraday Leverages 

Zerodha provides leverage in two different products: 

  • MIS (Margin intraday square off)
  • CO (Cover Order)

Both in MIS and CO, Zerodha provided up to 5 times (20% margin) leverage for intraday for equity.

For example, if you have Rs 1,00,000 in your trading account then you can purchase or sell stock worth up to Rs 5,00,000 for intraday trading.

Due to peak margin rules by SEBI, there is no leverage offered for equity F&O, currency, and commodities segments.

Zerodha Intraday leverages – MIS & CO

SegmentMIS Leverage/MarginsCover Order Leverage
Equity5X5X
Index F&O1X (100% of NRML margins(SPAN + Exposure))Not applicable
Stock F&O1X (100% of NRML margins(SPAN + Exposure))Not applicable
Currency Futures1X (100% of NRML margins(SPAN + Exposure))Not applicable
Commodity Futures1X (100% of NRML margins(SPAN + Exposure))Not applicable

You can calculate the margin available for a stock on the Zerodha margin calculator.

General Instructions regarding peak margin

  • 75% of the holdings selling benefit (subject to revision) is allowed immediately on T day for further trade in any product in any segment.
  • MIS (Margin Intraday Square-off) is allowed for all commodity scrips/contracts, except for option commodities and agricultural commodities.
  • Market to market (MTM) losses on any intraday product must be cleared on a T+2 days basis. Failure to do so will result in a short-margin penalty charged by the exchange.
  • Intraday MTM profits cannot be used on the same day.
  • The margin released due to carry forward options can be used on the same day.
  • There will be no immediate margin release from BTST (buy today, sell tomorrow) holdings square off, and a 30% upfront margin or VAR (Value at Risk) margin, whichever is higher, is required.

Intraday Margin (MIS/CO) Square-off Timings

ItemEquity/CashEquity derivativesCurrency futuresCommodity
Intraday Margin Time (MIS and CO)3:20 PM onwards3:25 PM onwards4:45 PM onwards25 minutes before Close

Let’s understand Zerodha leverage for each segment

#1. Equity Segment

For MIS Orders

MIS (Margin Intraday Square-off) which means that positions opened during the day are automatically squared off before the market closes. MIS is a type of leverage provided by Zerodha for intraday trading, allowing you to buy or sell stocks with a smaller margin amount.

Zerodha offers 5X leverage on equity Intraday which means if you have Rs 1,00,000 in your trading account then you can buy stocks only worth Rs 5,00,000.

Equity future & Options

Zerodha offers zero leverage or 1X leverage for equity futures & options trades. This means you must have sufficient margins in your accounts before taking a position in equity futures or options.

#2. Commodity Segment

In MCX (Multi Commodity Exchange), you can trade various commodities such as gold, silver, and crude oil.

Zerodha provides 1X leverage for the commodity trades, which means you need to have the required margins in your account to execute commodity trades.

#3. Currency Segment 

CDS (Currency Derivatives Segment) is a stock market platform where you can trade in  currency derivatives futures and options. 

You get 1X leverage for the currency segment trades which means you must have the required margins in your account to execute currency trades.

To understand the concepts of call and put options thoroughly, you may like to read What are CE and PE in options trading.

Zerodha Brokerage

SegmentsZerodha Brokerage Plan 
Equity DeliveryRs 0 (Free)
Equity Intraday 0.03% or Rs. 20 per executed order whichever is lower
Equity Future 0.03% or Rs. 20 per executed order whichever is lower
Equity Options Rs. 20 per executed order
Commodity Futures0.03% or Rs. 20 per executed order whichever is lower
Commodity Options Rs. 20 per executed order
Currency Futures0.03% or Rs. 20 per executed order whichever is lower
Currency OptionsRs. 20 per executed order

To explore other options available in the market, you can refer to our research report on the top 20 stock brokers in India.

FAQs

What is leverage in trading with Zerodha?

Leverage in trading refers to the ability to trade with borrowed funds. It allows traders to increase their exposure to the market and potentially earn higher profits with a smaller amount of capital.

In which products does Zerodha offer leverage?

Zerodha provides leverage through two products – MIS (Margin Intraday Square-Off) and CO (Cover Order).

What is used margin in Zerodha?

Used margin in Zerodha refers to the amount of capital that is utilized for your executed equity intraday, F&O positional /intraday trading & delivery orders including your open positions.

What is the leverage provided by Zerodha for intraday trading in equity through MIS and CO?

Zerodha provides up to 5 times (20% margin) leverage for intraday trading in equity through both MIS and CO.

About Rajan Dhawan

Rajan has covered personal finance and investing for over 5 years. Previously, he was in the IT field for 8 years after completing his MCA but his deep interest in personal finance led him to become an investing expert. He is passionate about investing, stocks, startups, and cryptos.

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