Position Square Off

 

Definitions

 

Net Available Margin (NAM) = Ledger Balance + Payin/Payout - Margin +/- MTM Gains/Losses +/- Booked Profit/losses (across all open positions)

 

Mark-to-Market (MTM) % is defined as total of mark to market gains and losses across all open positions plus Booked profit or losses across all closed positions divided by margins available at the start of position plus any funds payin or payout

 

There may be situations where Navia is forced to square off your positions in order to protect your interest, Navia’s business interest and also as per statutory guidelines. It is recommended that you continuously monitor your open/un-paid positions and bring in the required margins within the stipulated times so that Navia is not forced to square off your positions. Navia does not undertake or guarantee any communication to you before squaring off your positions. It is your primary responsibility to monitor your positions and to understand the policies of Navia, Statutory guidelines and comply with the same.

 

The following are the possible conditions under which Navia will be forced to square off your positions. This is not an exhaustive list.


  • MTM exceeds 40%: The clients' margin utilization and MTM is being tracked continuously by the RMS system. After taking positions the margin utilizations can change due to changes in Margins (increase in margins or removal of one leg of a hedged position) on the underlying positions and MTM can change due to increasing losses across all positions. All of the clients' positions (intra-day and carry forward) can be squared off by our RMS team at any time during the day once the Mark to Market (MTM) utilization exceeds 40%. The process of squaring off positions is subject to Navia’s discretion.


           However, on volatile days, Navia reserves right to square off positions even if M to M loss is at or above 10%,               on best effort basis, without prior intimation, depending on the market scenario. It can also block taking fresh            positions in such case

 

  • NAM is negative: At the beginning of the day, if the client has any margin shortfall (can be due to increase in margins or unpaid MTM loss), then the RMS would square off positions to the extent, that the shortfall in margin is eliminated. The process of squaring off positions is subject to Navia’s discretion.

 

  • Intraday Square off (Daily any time within 30 minutes of respective market closure)*

 

    1. All positions (Cash and derivatives) which are created as an INTRADAY product will be squared off any time within 30 minutes of respective market closure. This includes all types of Intraday products i.e. MIS, Cover Orders, Bracket Order and Stop Loss Orders.
    2. Every day any time within 30 minutes of respective market closure, the system shall automatically stop allowing any further intraday order. Our Risk Management system first removes all pending intra day orders and then squares off all Intraday Orders.
    3.  Inspite of best efforts made to square off positions, there is always a risk of positions not been squared off, due to market volatility.
       
  • Expiry day : On the day of expiry, High value ITM, ATM and CTM positions square off will start at 2 p.m. while normal ITM, ATM and CTM positions square off will start within 30 minutes of respective market closure.

 

  • Margin Trade funding (MTF): if you have bought shares under MTF and have not accepted the pledge link, the shares will then be squared off on T+1 day. Further If you have a MTF position where you have not maintained the required margins then Navia can liquidate/sell the shares (funded shares and Pledged shares) if the client fails to meet the margin call requirements. 
  • Collateral based trading in equity: If you have bought equity shares using Collateral provided by you for derivative trading and do not fund the position, the shares thus bought will be squared off on T+1 day.


Any Other Square Off


Navia Markets Limited may initiate square off, of a particular client without prior intimation due to market volatility, debarred by SEBI or as prescribed in any other rules or regulation.


Note: 

 

  • Auto square-off (Call and trade) charges apply for each order squared-off by our system. It is recommended that you close your open intraday positions before the above mentioned time / situation. Navia cannot be held liable for the losses and charges on account of being forced to close your positions due to the above reasons. For more details refer here
  • It is advisable to credit funds via payment gateway provided for clearing the debit balance as the same is updated on a real-time basis.
  • Intimations prior to square off are merely add-on services provided as a precautionary measure by Navia. Navia holds the right to initiate risk-based square off with or without intimations.

 

*Intraday square off is merely a right of Navia and not an obligation. Intraday squaring off  is an action of closing off any open position and it can be done best by the customer himself. Any intraday product which is not squared off shall be carried forward to the next trading day and will be auto-converted into a “Delivery Product”.

 

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