How Much Margin Is Required For Nifty Futures?

How Much Margin Is Required For Nifty Futures is the first question to answer when you start Nifty futures trading.

With options trading, you can just trade with whatever amount of premium is required. With the Nifty futures trading about 15% to 20% of the whole of the premium.

How Much Margin Is Required For Nifty Futures depends on the brokerage opting to trade with.

Some brokerages have just the minimum requirement of 9%. Some others charge 15 to 20% of the premium.

With 15 years of full-time trading experience, I am welcome in usually each and every broke right with a lesser margin.

This may not be the case for a novice trader.

Let’s now jump in and understand what brokerages have the requirement for how much margin is required for nifty futures.

The nifty futures margin requirement is dependant on these factors:

1. Nifty futures lot size
2. Brokerage firm
3. Span Margin
4. Exposure Margin

 

How is the Nifty Futures margin requirement calculated?

Let’s say, a Brokerage A, calculate are a requirement of 15% margin required.

Full Amount Required to trade 50 lot size of Nifty Futures which is currently at 15500 is:

15,500 * 50 = 7,75,000.

Brokerage firm A wants the margin at 15% of Nifty Futures Margin amount, which is:

7,75,000 * 15% = 1,16,000

So as per the Nifty Futures Margin example, brokerage A requires a margin of 1,16,000 to trade nifty futures.

Though the above is just the span margin calculation, exposure margin is not considered in the above example.

We’ll look at it further in this article.

 

Let us look at each of the factors and understand the requirement.

1) Nifty futures lot size:

The nifty futures lot size is now 50 as per NSE on April 1, 2021.

The Nifty futures margin requirement is about 9 % to 20% off the lot size. Of course, this is dependant on the brokerage firm about what amount they charge.

 

a) Who determines the nifty futures lot size?

Since Nifty is the index of NSE (National Stock Exchange), Nifty lot size is calculated by NSE.

 

b) Why is the lot size of Nifty Futures varying?

Nifty Futures Lot size is dependant on the value of Nifty Futures. Usually, NSE cuts down the lot size when Nifty futures increases by about 3,000 to 5,000 in value.

Though, it’s not just cutting the lot size, when the value of nifty futures depreciates, the lot size will be increased too.

 

2) Brokerage Firm:

How much margin is required for nifty futures depends mostly on the brokerage firms. There are lots of discount brokerages out there that offer lesser margins for trading.

Though there are in excess of 20+ brokerage firms, only a handful are discount brokers.

Some famous discount brokers are Zerodha, Tradeplus, BN.Rathi securities, Fyers I feel are good.

Most of these brokerage firms have a span margin and exposure margin depending on the firm.

We’ll look at the details of span margin and exposure margin further below in this article.

 

3) Span Margin:

The amount required for trading Nifty futures for the brokerage firms calculation.

Span margin is the margin amount required to trade Nifty futures.

For ex) Brokerage firm A charges a 13% span margin.

So 7,75,000 *13% = 1,00,750

This is the meager amount required for how to trade Nifty futures as per Brokerage A.

Along with 1,00,750, there is another multiple of amount required to trade nifty futures.

That is called exposure margin. We’ll look at it next.

 

4) Exposure Margin:

Exposure margin is the amount kept aside, which would be required when you write the options or sell futures.

when you sell the futures, literally loss percentage can be unlimited.

so brokerage firms exposure margin, as a guarantee, that the amount will satisfy your losses if any.

the exposure margin keeps increasing when your loss percentage keeps increasing.

 

How Much Margin Is Required For Nifty Futures by Different Brokerages:

1) Nifty Futures Margin Zerodha: 

Span Margin – ₹94,819, Exposure Margin – ₹15,625. Total – ₹1,10,903

 

2) Nifty Futures Margin Upstox:

Span Margin – ₹1,39,475, Exposure Margin – ₹0, Total – ₹1,39,475

 

3) Nifty Futures Margin Tradeplus:

Span Margin – ₹1,05,000, Exposure Margin – ₹0, Total – ₹1,05,000

 

4) Nifty Futures Margin Samco:

Span Margin – ₹1,41,716, Exposure Margin – ₹23,339, Total – ₹1,65,055

 

5) Nifty Futures Margin 5Paisa:

Span Margin – ₹1,13,845, Exposure Margin – ₹0. Total – ₹1,13,845

 

6) Nifty Futures Margin Wisdom Capital:

Span Margin – ₹1,63,804, Exposure Margin – ₹81902. Total – ₹2,45,706

 

7) Nifty Futures Margin Angel Broking:

Span Margin – ₹0, Exposure Margin – ₹23,499. Total – ₹23,499

 

8) Nifty Futures Margin Trade Smart Online:

Span Margin – ₹1,64,911, Exposure Margin – ₹0. Total – ₹1,64,911

 

9) Nifty Futures Margin Kotak Securities:

Span Margin – ₹1,65,594.56, Exposure Margin – ₹0. Total – ₹1,65,594.56

 

10) Nifty Futures Margin Fyers:

Span Margin – ₹118,043.2, Exposure Margin – ₹0.  Total – ₹118,043.2

 

If I have missed out on any of the discount brokerages, please comment below. I will try to find out the futures margin for the brokerage firm.

Disclaimer: I have managed to Grab the information as much accurately as possible. This may or may not be the benchmark for you to consider the discount brokers.

 

So now you know how much margin is required for nifty futures. Was this info sufficient?

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Happy Trading and Happy Money Making!