Margins blocked by brokerages - Options strategy

Dear Members:

Please shed light if there are any brokerages that block minimum margins when we use complex options strategies like iron butterly, iron condor, etc.

Example: For an iron condor strategy this month, the max profit is Rs. 13,100 and the max loss is Rs. 11,900. So is there any brokerage that will only block 11,900 as that is the maximum risk?

Thanks

Unfortunately that concept is yet not understood by the brokers here in India. ICICI Direct comes closest which will charge SPAN Margin plus around 6% Initial Margin. With them, you can check out the margin requirement before punching the trade.

Thanks moneygurukul, I will check with them

What you are referring to is Spread Margin. It is not available in India. Many things are crappy here compared to trading the US markets. One is spread margin. 2. You cannot put T-bonds or equivalent say RBI-bond as collateral. 3. You don't get paid any interest on your deposit to broker. Though Geojit gives you the option to withdraw entire ledger balance every day and add only the amount with which you want to trade.

Exactly. Any brokerages reading this message, perhaps you can think about including this facility. I am sure it will increase the volume which will be good for the brokerages because they will benefit from the volume and not on the margin blocked or client's deposit.

I m tradin with mf global. They just charge only maximum risk if u entring any startergic tarde or if u hedge ur future position with next month.

Thanks Varin, I will check with them.

Hi,

Is it confirmed that mfglobal charges only spread margin (that is maximum risk in the trade instead of margin for every sell irrespective of whether its covered or not)? I tried talking to icicidirect executive. He hardly knows anything about options and I didn't get an answer. Is ICICI direct also charging spread margin?

Thanks,