What Is Margin Calculator ?
Arihant Capital Margin Calculator or NSE F&O margin calculator is an online margin calculation tool for Equity Cash, Future & Option. This will helps you to calculate comprehensive VAR margin, SPAN margin, exposure margin and premium margin requirements for trading in Equity cash, futures, options writing /shorting, and multi-leg F&O strategies. You can use a margin calculator for nifty and indexes also. We download NSE SPAN files on real-time basis, so Arihant Capital margin calculator will give you real-time margin update for your trades.
Span Margin
SPAN margin is the minimum Margin required by the exchanges in F&O segment to initiate a trade in the market. SPAN margin is calculated by standardized portfolio analysis of risk (SPAN), a leading system developed by Chicago Mercantile Exchange (CME) that has been adopted by most options and futures exchanges around the world. SPAN is based on a sophisticated set of algorithms that determine margin requirements according to a total portfolio assessment of the one-day risk for a trader's account.
Exposure Margin
Exposure margin is addition to SPAN margin which is collected at the time of initiating trades. It is charge over and above the SPAN margin which is the discretion of the broker. Failure to have requisite SPAN margin in the account can result in penalty being levied by the exchanges. This margin is collected in order to protect a broker 's liability which may arise due to erratic swings in the markets.
Difference Between Span Margin & Exposure Margin
The SPAN margin is not a fixed margin. It keeps changing as per the changing risk factors whereas the Exposure margin is fixed entity since its only focus is to cushion portfolios against market upheavals.- The SPAN margin is based on the risk factor on the other hand Exposure margin based on the exposure factor
- The SPAN margin is calculated by a software whereas the Exposure margin usually factored and calculated by the broker
How To Use Margin Calculator
- Select the Exchange where you want to trade on it- Equities, NFO, CDS
- Then select the product type - Futures or Options
- Next in the ticker option type symbol of the scrip you wish to trade
- Select the expiry date of your trade
- Select the Quantity of your trade
- Put the strike price in case of Options
- Choose the type of trade - Put or Call
- At last click on Add to calculate your Margin
FAQ
Margin is the minimum amount payable to take a position for trading in the share market. Whether you are trying to buy or sell, your stock broker will collect the margin upfront as a cushion to cover for the risk caused by market volatility.
Total margin is the sum of Span margin & Exposure margin which you need to pay before taking any position in Future & Option segment.
Total Margin = SPAN Margin + Exposure Margin
The SPAN margin methodology evaluates overall portfolio risk by calculating the worst possible loss that a portfolio of derivative might reasonably incur over a specified time period (typically one trading day). This is done by computing the gains and losses the portfolio would incur under different market conditions.
SPAN margin is calculated for F&O positions in Equity Derivatives Segment of NSE only. Positions in Cash segment not part of SPAN margin calculation. Currency & Commodity derivatives segments are not covered.
Exposure margins are applicable while trading in the NSE in the F&O segments and while trading in the MCX in the commodity derivatives.
