How does it really works?

How does it really works?

Say If I buy Nifty futures @ 6300 today (9th Nov)=My margin money needed is 10%*50*6300 which is approx Rs.30000.

Tomorrow 10th Nov, nifty goes down 100 points, Nifty @ 6200. so i need to add 100*50=5000 to my ledger account to avoid square off by broker. so my total investment would be Rs.35000 so far.

next day, 11th Nov, Nifty goes up 200 points, Nifty @6400. Profit of 100 points, which is Rs.5000. So Now if i sell my 1 lot of Nifty futures, my total amount would be Rs.30000(initial investment)+Rs.5000(added money to avoid square off by broker)+Rs.5000(profit of 100 points). Rs.40000 will be there in my account, am i right.

my doubt here is on the second day, nifty goes down 100 points, they will not deduct 100*50=5000Rs. from my account if i add the aditional margin money, right?

Am planning to start trading with Mini Nifty with just one lot.

Investment needed is Just Rs.12000. But in order to avoid loss due to unexpected market movement, I will have additional surplus amount of Rs.8000(400 nifty points*20 lot size).

Bought Nifty futures @ 6200, strong support for Nifty @ 6000, so nifty can go down till 6000 or at the max 5800. Maximun down probality is 400 points, so if i have that additional Rs.8000, i can avoid my loss by adding this margin money.

By this way I can increase the profit probability. Please advice!!

Hi Ravi,

Thanks for your reply. But the above points are not my strategy. That is just an example.

I just want to know whether my broker will deduct money from my account when nifty goes against my posisiton if i add the aditional margin money?

oh..even if i add the additional margin money also my broker will deduct my losses???

Since you got enough money to support your MTM, he won't call you to put money in your trading account and he won't close your position.

In your ledger you will see MTM profit/loss of Rs. xxxx...

For eg:

You take position long @ 6300

Mininifty closed @ 6290

Your MTM loss is Rs. 200/-
Margin blocked for your long position is Rs. 12000/- (approx)

Rest of the amount (8000-200 = 7800)will be there in your account. You can very well utilize this amount for trading.

OMG!! So unless and until we are sure about market direction, it is difficult to profit from Futures. If we are unaware of the direction, we end up paying additional margin every day

thanks for inputs

am confused b/w Options & Futures. which one to choose, i have been trading in equities cash segment delivery based trading but wanna enter into FnO.

So clearing all my doubts before i enter in.

Thank you

i got a doubt with regard to futures please clarify

suppose on Monday 12 pm i bought 1 lot ( say 2000 shares ) of company A for Rs 100 per share the share closed on Monday evening at Rs 110 per share, i did not sell then, on Tuesday it went down to Rs 95 per share, again i did not sell , on Wednesday when it reached Rs 105 per share i sold it off.

would anyone explain in detail what is the total profit or loss that i have made?