Who can avail margin trading facilities?
Margin Trading Facility (MTF) is extended to existing clients who are active for trading NSE. However, NRI clients shall not be eligible for MTF.
What are the benefits of MTF?
If the client’s outstanding dues in regular trading a/c stand beyond T7, SEBI rules de-bars further exposure until the client clears such dues beyond T7. Under MTF, clients can avail of the funding for longer periods subject to fulfillment of maintenance margin and other conditions. Further, MTF will command a lower margin as compared to the margin applicable for Loan against Shares.
For example, if you buy ACC worth Rs. 1,00,000, it will command a margin of Rs.25,000 i.e., @ 25%, and the rest will be funded by ACML subject to terms and conditions.
What is the rate of interest for mtf?
The cost of availing the facility is only 0.0576% per day (Annualized cost – 21% ) on the daily ledger balance.
What are the Margin Requirements?
All positions under MTF (existing/potential) shall attract upfront Initial Margin (IM) prescribed by ACML from time to time.
Can I transfer stocks towards the Initial margin?
Yes. You may transfer Initial Margin in the form of Cash/ Group I Securities approved by ACML to the credit of our MTF Securities Collateral Account. Post the transfer, the client may start trading under NSE MTF . During the end of day process, Collateral will be shifted by ACML to the respective exchange where the trade is executed.
What is a Group I security?
Stock Exchanges periodically publish the list of Equity shares under Group I/II/III as per SEBI Master circular no. SEBI/HO/MRD/DP/CIR/P /2016/135 dated December 16, 2016. The exchange wise list is published on www.acumengroup.in/ Approved securities.
What are the types of Stocks dealt under MTF?
Only Equity shares that are classified as Group I Security shall be dealt with under MTF. Stocks under MTF include Collateral Stocks to be deposited by you for availing MTF and Funded Stocks purchased by you under MTF.
Do I have a separate UCC for Normal Trading and MTF?
No. Only one UCC bearing your client code will be used for placing orders at Stock Exchanges. You have to select the “MTF“ product for placing orders under the MTF category. You will have an only a single ledger, but normal and MTF accounts will be segregated with different product codes.
How can I transfer shares from my POA a/c to MTF collateral a/c ?
You can transfer shares from your POA a/c to MTF collateral a/c by delivery instruction slip, written request, or a request from your registered email address.
Important: Please note only eligible stocks will be available for transfer from POA to Collateral
Will I get dividends and other Corporate action on my shares in Collateral a/c?
The dividend amount, if any, will be credited to your MTF Trading A/c (i.e. M A/c) on receipt of the same from the company in our Bank A/c. Other corporate action benefits (like a bonus, split) will also be added/split to your holdings on receipt of the same from the company in our Collateral a/c.
Can I do Margin Trading at the Derivative segment?
No. MTF is a facility extended by Corporate Stock Brokers only for the Equity Segment.
Do I get a separate contract note for Normal trades & Margin Trades?
No. But the trades under MTF need to be distinctly identified. So, for all other purposes, the trades are executed at the Exchanges in a single UCC, and all levies, including STT, shall be levied as per single UCC.
Can I do a short-selling under MTF?
No. Short selling is not allowed
Can I execute intra-day trades under MTF other than a short sale?
Yes, subject to the availability of margins.
Can I freely sell stock acquired at MTF at any desired Exchange?
No. Sale of Funded/ Collateral Stocks at MTF of an Exchange shall be restricted to that exchange. Such Stocks shall not be allowed to be sold at other exchanges.
How do I place an order under MTF?
You will be able to place orders at the Normal Segment and MTF based on the consolidated margins. Orders can be placed on-line or off-line. Orders under NSE MTF need to be marked by you as MTF Product. If there are sufficient collaterals under your respective MTF Collateral account, the marking shall be accepted by us.
What is the Brokerage applicable for MTF?
The brokerage slab shall be the same as applicable to the Normal Trading Account.
Do I need to maintain the required margin at all times for the MTF?
Yes
What are the types of margin calls sent to me?
You may get a Maintenance Margin Call at the end of any trading day for the deficit in maintenance margin. This happens when the margin value of the collateral stock is not adequate to meet the margin required for funded stock. You may get Mark to Market Margin Call, where the Loan to Value exceeds 85% at an Exchange. The loan shall mean the ledger debit plus accrued interest under the Margin Trading facility. The value shall mean the Gross Value of funded stocks and Collateral Stocks deposited by the client with ACML valued at the last close price. You need to bring additional Margins to keep Loan to Value within the 80% level.
What will happen if I fail to maintain the required margin at all times?
In case margin falls below the minimum required margin, you will not be allowed to buy any securities under MTF and ACML shall make a Margin Call, and the position can be liquidated at any time when sufficient margins are not in place. SMS shall be sent to the client on such liquidation.
What happens to my existing Purchase? How do I convert it to MTF?
In order to transfer position to MTF intraday, you need to change the product from normal to MTF. Prior to this, you need to transfer enough Collateral in MTF.
How do I move Collateral from the beneficiary to MTF Collateral?
You need to send a special request to us mentioning the exchange in which the beneficiary is to be parked as Collateral. The shifting is allowed with the specific understanding that dues in the normal account will be liquidated by you through the sale of stocks, and equivalent purchases will be made in the MTF account.
Can I withdraw part of the funded stocks where the stock value has appreciated beyond the MTF dues?
No. Funded Stocks can be released only on clearance of MTF dues and accrued interest.
Can I withdraw part of the funded stocks by making part payments towards the MTF dues?
Stocks withdrawal against part payment shall be subject to such conditions as may be stipulated by ACML from time to time.
How can I transfer available credit in normal a/c to MTF Cash Margin a/c?
You may request to contact our team to transfer any clear credit in the Normal ledger to MTF Cash margin A/c by way of JV, which will be processed at periodic intervals.
How long can I keep a debit balance under an MTF account?
You can keep the debit under MTF as long as it is supported by sufficient Collateral subject to the terms and conditions.
Can I withdraw funds from my MTF a/c ?
In case you wish to withdraw available credit from your MTF a/c, you need to inform us or send an email at mtf@acumengroup.in. Available funds in your MTF a/c, after considering the margin requirements, will be transferred to your normal a/c. You may then put in a payment request for the required amount. The requested amount will be transferred to your registered bank a/c.
Can I sell shares that are placed as MTF collateral?
Yes, you can sell MTF collateral under a ‘normal ‘ product. You have to give a request for transfer from your POA account to MTF collateral account for initial margin fulfillment from Group 1 securities. Or else, ACML will be passed to JV for transfer of the required margin value from normal account to MTF ledger.
