Cover orders give you higher leverage by ensuring that you place a stop loss. This is beneficial only for intraday traders. Generally the cover order (CO) gives you more leverage than MIS (intraday) product type and you require 50% less margins for trading.
> What is Cover Order Product (CO) ?
> How much more intraday leverage do I get for trading in say, gold futures?
Here is an example: Suppose you are doing intraday trading in Gold futures. If you have Rs 40000, then you can trade 9 lots under MIS intraday product. But using cover orders, you can trade 15 lots!
> Can I place a limit main order?
No, main order is always a market order.
> Can I place Cover orders (CO) in all stocks, currencies and commodities?
For Equity Segment cover order type (CO) is available for all Stocks available in F&O segment.
For Future segment cover order type (CO) is available for Nifty Index futures (NIFTY, NIFTY IT Index and Bank Nifty) and
For Commodity Segment cover order type (CO) is available for all commodities.
> What is the Margin requirement for Cover Order
Equity Segment - 3%
Futures - 3 %
Commodity Segment - SPAN/5
> Is it compulsory to choose a Cover "SLTP Order" while placing a Cover Order Product (CO) ?
Yes. It is mandatory to place a Cover SLTP order along with your Cover Order main order.
> What is a Cover Stop Loss order?
Important notes regarding Cover Orders
Please note that in a buy order, the SLTP should be a price lower than the buy price i.e less than the last traded price. An SLTP cannot be placed for a price that has already been surpassed by the market when the SLTP is being placed. Similarly, in case of a stop loss sell order the SLTP should be greater than the sell price of fresh order i.e. higher than the last traded price.
> What are the details required to be given to place a main order?
Following details should be provided to place a main order.
b. Stock (Symbol)
d. Client Id
e. Stop Loss Trigger Price
The first 4 values would be automatically picked up from the main order details. The Stop Loss Trigger Price value is required to be entered by you which would be the trigger price and the order gets activated once the market price of the relevant security reaches or crosses this threshold price.
> Are the main orders , cover SLTP orders to be placed together?
Yes, the fresh and cover orders under Cover Order (CO) are to be placed together.
> Should the quantity of main ,cover SLTP order be the same?
Yes, the quantity needs to be the same.
> Can I cancel the cover SLTP order?
No, cover SLTP order cannot be cancelled.
> Can I modify the cover SLTP order?
Yes, you can modify the price of your cover SLTP order subject to the Trigger price conditions being fulfilled.
> What is the quantity that can be submitted for fresh orders?
The maximum quantity that can be submitted for fresh orders is the total of best 5 Bid/offer quantities that is available in the best bids and offers. If the quantity that you input is greater than the quantity available in the best 5 bids and offers then the order will not go through. Assuming that you want to place a buy order for 3000 shares @200, and the first 5 offer quantity available for the buy order are as under:
In the above scenario, the first 5 Offer quantity available is 2600 and since the buy order quantity placed is 3000 which exceeds the best 5 offer quantity, it would be rejected by the system. Similar would be the case in Sell order, wherein if the total sell qty is greater that the first 5 Bid quantities available then it would be rejected. The maximum order qty to be placed should be equal to the first 5 bid/offer quantity available at that point of time.
> What will be the price at which margin for an order will be calculated?
For fresh orders the price would be calculated as the weighted average price of the best 5 bids and offers available for calculating the margin requirement. If the following offers are available in the best 5 bids and offers and the client places a Buy order for quantity of 500.
|Best 5 bids|| Best 5 offers|
Calculation of Buy price