Lowest Margin For Options Trading

Tejas Khoday

Co-Founder & CEO, FYERS
#3
Hello,
Which brokerage in the market is offering lowest margin for positional trades in shorting options.

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Any broker who provides leverage over and above the exchanges margins for overnight positions is playing with fire! First of all, it means that the brokerage is funding your trades because brokers have to pay up margins from their own capital to the exchange since they are not collecting full margins from the clients. Secondly, it is not compliant. Thirdly, it is not sustainable by any stretch of imagination!

As a retail trader, I know that it can be exciting to avail the maximum leverage but it does more harm than good to your performance. Excessive leverage actually has a negative effect on your P&L because it reduces your ability to withstand the volatility in the market. I urge you to change your thought process about leverage. More does not equal to better. It is the opposite! Every scrip has a sweet spot beyond which you are more likely to lose either due to the shortage of margins or due to panic attacks!

:)
 

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