Q. What is Margin Trading Funding (MTF) Facility?

A:  MTF is the funding facility offered by the Company to its customers to buy stocks with a minimum required margin and hold the stocks for an extended period of time.


Q: How can I avail this MTF facility?

A:  This MTF facility can be availed by opening the MTF trading account and transfer initial margin by way of cash/ collateral to purchase the shares under this facility. 


Q. Can I get the MTF funding facility to my existing trading account?

A:  Yes. You can activate the MTF segment on your existing trading account itself and there is no need to open a separate trading account.

The MTF product is added to the same trading account as separate segment i.e. MTF segment. For more details on how to activate the MTF segment click here. 


Q: Do I need to open a separate demat account for MTF funding?

A: No, a separate demat account is not required for availing this MTF funding facility.


Q: Do I need to sign an agreement apart from KYC, to open MTF account?

A: Yes, you need to sign an agreement, and have to agree to the terms and conditions of the MTF funding account.


Q. What are the Scrips funded under this MTF?

A: Equity shares that are classified as group 1 security and as in the approved list are available for the margin trading funding. (List of securities is made available in the web site).


Q: What is the amount of margin /leverage that I need to pay/have during buying stocks?

A:  Required margin and leverages may vary for different stocks. See details given below


Category of Stock
Initial margin and maintenance margin
Exposure allowed by Navia
Group I stocks available for trading in the F&O segment
VaR + 3 times applicable ELM
4 times
Group I stocks other than F&O stocks
VaR + 5 times applicable ELM
3 times


Q. What type of initial margin is allowed under this MTF?

A: We may allow customers to pay margin in the form of NSE Approved list of shares post hair cut or cash or cash equivalent.


Q: What is the segment and under which exchange Margin Trading Facility is offered?

A: Margin Trading Facility is available only under cash segment for selective scrip, traded in the  Exchange of NSE only.


Q: Can I purchase the shares from the BSE cash segments?

A No, you cannot buy shares under the MTF in BSE cash segment, and BSE scrips can be traded in the normal segment without any leverage.


Q: Do I need to pay any charges for Opening / activating the MTF trading account.

A: No, you no need to pay any charges for opening the MTF trading account.


Q: How do I get all details of my Margin Trading Funding transaction?

A: You will get all communication regarding confirmation of orders/trades, margin calls, decision to liquidate the position / security on your registered email/ Mobile Number.


Q. How do I know that my MTF trades are uploaded to my MTF trading account?

AEveryday, once we receive the trade file from the exchanges, we upload the trades first to the MTF trading account and if at any time the MTF segment does not have sufficient margin in the MTF segment the same will be uploaded to the normal trading account. Further, Navia shall send an e-mail confirmation of the shares that are uploaded to the MTF segment at the end of the day.


Q: Do I need to confirm/ mark the trades on a daily basis for the MTF trades upload?

A: No, Presently as per our system, once you sign the terms & conditions of the MTF product, the trades as per the MTF scrip will be uploaded to the MTF account.


Q: How can I identify the margin call transaction liquidated by the company?

A: Margin call transactions are marked separately in the contract note, when liquidation is initiated by the company.


Q: What happens if I transfer funds to the MTF segment of my trading account and have not done any trading?

A: Margin trading accounts where there is no transaction for 90 days shall be settled immediately / as per running account settlement


Q: How can I carry and hold my funded position for a long period?

A:  The shares purchased under the funding account can be held by maintaining the required margin as per the margin calls for a period of upto 1 year


Q: What is the interest rate offered under this MTF funding?

A: We offer the margin trading funding facility with the interest rate @ 2% monthly.


Q: Can I transfer funds from my normal trading account segment to the MTF segment?

A: Yes, you can transfer the funds from the normal trading account segment to the MTF segment, as per the terms & conditions of the product.


Q: How can I sell the hold back shares collateral in the MTF trading account?

A: We shall upload the Hold back shares & Collateral shares on a daily basis to the trading terminal, and you are allowed to sell the shares in the market through CNC product.


Q: Is there any cash -collateral ratio for the initial margin?

A: No, under this facility there is no cash -collateral ratio.


Q: What is the hair cut percentage applied for the collaterals?

A:  NSE hair cut percentage is applied for the valuation of the collateral value for the purpose of margins.


Q: What is the meaning of margin calls?

A: Margin calls are the alerts made by the Company when there is a reduction in the amount of margin placed with the Company.


Q:  When shall the Company makes the Margin call report on my MTF trading account?

A: Every day once the trades are uploaded to the trading terminal, system will automatically generate the Risk Report and based on the margin available in the MTF account. This margin call will be sent by e-mail/SMS  to the client for making the payment immediately.

 

Q: What is the impact of the margin call if not honored by the client?

A:  Company may liquidate the shares if the client fails to meet the margin call requirements.


Q: Is there any reporting to the exchange on a T+ 1 day of the purchases by the company?

A: Under this funding facility, Company shall report to the exchange with the client details and the funding amount offered to the client on a daily basis on or before 12 PM.


Q: Can I close/ suspend the MTF funding facility offered by the company.

A: Yes, the client can close or suspend the Margin trading account at any time after paying the dues.


Q: Can the company terminate/ suspend the client MTF segment on my trading account?

A: Yes, the Company can terminate/ suspend the client MTF segment, in the event of client committing the breach of any terms & conditions of the MTF funding.


Q: What is the difference between a normal trading account and MTF funding account?

A: Normal trading account Company allows the client to purchase the shares and securities and hold it for a period of T+2+5 day. The account will be blocked on the 7th day and shares shall be liquidated by the Company. But under the MTF account, the client can purchase the shares and hold it for a period beyond 7 days by meeting the required margin. 


Q: How can I buy & sell the shares under MTF facility?

A: The clients are provided two products in the trading terminal, i.e NRML & CNC for placing the buy and sell orders respectively.


Q: Can I have two MTF account with different brokers?

A: No, the client can avail this funding facility only from a single broker and the client has to give a declaration at the time of MTF account opening.


Q:  Can I get the benefit of the corporate actions like dividend, bonus etc. for the shares held in the MTF account?

A: Yes, the benefit of the corporate actions will be credited to your account.


Q: What if my stocks bought under Margin Trading Facility get appreciated? Will I get additional margin on it?

A: No! you will not get benefit of any MTM gain on your margin trading position.