Are there any capital requirements besides the MTF margin?

Yes, in addition to the upfront MTF margin, you may also need to pay for Marked-to-Market (MTM) losses.

What are MTM losses?

MTM losses represent the daily difference between the purchase price of your stock and its current market price. If the stock price falls below your buy price, the unrealised loss is termed as a mark-to-market (MTM) loss. This needs to be paid to maintain your MTF position.

For example:

If you bought a stock under MTF at ₹100 and its market price drops to ₹95, you have an MTM loss of ₹5 per share, which must be settled as part of your capital obligation.

Why does it matter?

• Maintaining Compliance: Paying MTM losses ensures you remain compliant with the margin maintenance requirements set by Share India and regulatory bodies.
• Avoiding Risk Actions: Failure to meet MTM obligations may result in margin calls by Share India. Share India’s RMS may ask you to cover any margin shortfall on shorter notice.
• Better Control: Being aware of MTM obligations helps you manage your exposure and capital more efficiently.

You can use the available cash balance or approved collateral to meet these obligations. Staying on top of both margin and MTM requirements is essential for uninterrupted use of the MTF facility.

For any questions or assistance, feel free to reach out to Share India’s support team at support@shareindia.com or call us at 1800 203 0303.