Margin Trading Facility (MTF)

Low on Funds? No Problem

Buy Now. Pay Later. Enhance your buying power with our Margin Trading Facility.

4x*Leverage available on MTF
9.75% p.a. with Trade Free Pro
Open Demat & Trading Account
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How does Margin Trading Facility works?
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Understanding Margin Trading Facility
In our comprehensive guide on Margin Trading Facility (MTF), we will take you through the world of MTF, exploring how Kotak Securities offers you a remarkable 4X margin on trading stocks.
Unlock the full potential of financial growth
Align your financial goals and enjoy affordable access to our comprehensive trading features and tools.
Follow these 5 easy steps
Step 1: Access the Buy Page
Go to the buy order page of your preferred stock.
Enter quantity and Select “MTF” under the product type.
Once done, you will be able to place an order using MTF.
Cross-check the order details and proceed to buy.
Your order will be placed under MTF.
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*Margin available up to 4x on 1000+stocks

Frequently Asked Questions (FAQs) for Margin Trading Funds

Margin Trading Facility (MTF) is an exchange-approved product wherein individuals can purchase stocks by paying only the initial margin, with the remaining amount being funded by Kotak Securities Ltd. One can either keep the position open as long as they want or can take delivery of the stock.

The interest charges are as low as 0.028% per day, which are applied from T+1 day onwards. These charges vary for all users based on the brokerage plan they have selected.

With the introduction of the pledge model in September 2020, it has become mandatory to pledge stocks purchased under the Margin Trading Facility.To hold your MTF position for as long as you want, user are required to pledge the stocks purchased under MTF on T Day on the link received from NSDL.

Yes, there is a charge of Rs.20 + GST per ISIN for both pledging and unpledging.

In the event that you fail to pledge the stocks purchased under MTF, your position will be liquidated.

With Kotak Securities Ltd, once you have pledged your MTF stocks, you can maintain your position for as long as you wish, or you may choose to convert the position to cash.

Cash, existing stocks, and ETFs kept in their Demat account can be used as margin post pledging.

Benefit: Leverage enables you to amplify returns on a smaller investment, as seen when paying only 20% upfront for a 10% return on the stock price, resulting in a 50% return, pre-cost.

Risk: However, it's crucial to note that leveraging also adds losses on a smaller investment. For example, paying only 20% upfront for a 10% loss on the stock price means you lose 50% of your capital, pre-cost. Understanding the risks associated with Leverage is vital for informed decision-making.

Benefit: Unlimited holding period allows you to hold a trade indefinitely if you believe it offers a better chance of making a profit.

Risk: Nevertheless, holding a trade for an extended period increases your interest costs, raising the breakeven for your trade. Additionally, if the trade moves against you, you may need to provide higher margins or face liquidation.

The creation of a MTF position against shares as collateral is now open to investors. SEBI and Exchanges keep a close eye on the securities that qualify for the MTF, and they periodically prescribe the margin that must be placed on such securities (either in cash or as shares of collateral).

A margin trading facility, such as MTF, can be powerful if you aim to maximize the potential of your business. This feature makes it possible to place more bets on the market than your account balance usually is able to allow, which can result in a higher profit margin by increasing purchasing power.

You may continue to own shares if you like and pay interest on the funding amount. MTF is only available to a couple of exchange-approved stocks, as opposed to Cash. In your app, this information is available on a stock detail page that relates to margin requirements.

Open Demat & Trading Account
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