How Much Margins Leverage Does Kotak Securities Provide?

Kotak Securities is a prominent name in the world of trading and investments, known for its diverse range of offerings and customer-centric approach. One of the key features that sets Kotak Securities apart is its provision of margin leverage, allowing traders to amplify their potential returns. In this article, we will delve into the specifics of the margin leverage provided by Kotak Securities across various segments.

Types of Securities for Margin Trading

Kotak Securities extends its margin offerings to a range of securities, including stocks, mutual fund units, and exchange-traded funds (ETFs). This comprehensive approach allows traders to diversify their portfolios and explore various investment avenues with enhanced flexibility.

Margin Intraday Square-Off (MIS) Order Type

For those looking to engage in intraday trading, Kotak Securities offers the Margin Intraday Square-Off (MIS) order type. With MIS, traders can access up to 5 times leverage on their intraday trades. This means that they can execute trades with a value of up to Rs. 50,000 while maintaining collateral (post haircut) of only Rs. 10,000.

This feature is particularly beneficial for individuals seeking to capitalize on short-term market movements. It enables traders to maximize their potential gains by utilizing a smaller amount of capital upfront. However, it’s important to note that MIS positions must be squared off within the same trading day.

Margin Trade Funding (MTF)

In addition to MIS, Kotak Securities also offers Margin Trade Funding (MTF) as an order type. Under MTF, traders are required to contribute a minimum of 25% of the trade value upfront, either in the form of cash or stocks as collateral. The remaining balance is then provided by Kotak Securities at a nominal interest rate. Notably, positions under MTF can be held for an indefinite period, offering greater flexibility compared to MIS.

This feature is ideal for traders who prefer to hold their positions for an extended duration, allowing them to capitalize on potential long-term market trends. The ability to secure funding at a reasonable interest rate can be a valuable tool for maximizing investment opportunities.

Time Period for Position Holding

The primary distinction between MIS and MTF lies in the duration for which positions can be maintained. MIS positions must be squared off within the same trading day, emphasizing short-term gains. On the other hand, MTF positions can be held for as long as the trader desires, providing the flexibility to capture potential long-term market movements.

Source: Kotak Securities

Conclusion

Kotak Securities’ margin leverage offerings provide traders with a valuable tool to amplify their trading potential. Whether it’s through the Margin Intraday Square-Off (MIS) order type for intraday trading or the Margin Trade Funding (MTF) for longer-term positions, Kotak Securities offers a diverse set of options to suit various trading styles.