01 Nov 2021 | 5 min read
In the stock market, the term Margin Trading Facility (MTF) refers to the process where investors into the stock market purchase more stocks than they can afford. The stockbroker pays for the due amount and levies interest on it.
Besides, Margin is a partial amount that is paid by the investor. In addition to this, Margin Trading is a simple way of making money by means of NRI investment in India.
Let’s take a look at the different and core elements of Margin Trading for NRIs.
Difference Between Normal Trading and Margin Trading
Without hovering around, take a look at the following differences between Normal Trading and Margin Trading to perceive them smoothly:
Following are the benefits of Margin Trading that you can enjoy on executing it. Have a look at the below-stated points to perceive them:
*Note: T stands for the day of trading and N stands for the number of days a position can be carried forward to. Moreover, N also depends upon the stock broker's terms and conditions.
There are only a few Indian brokers available in the industry that offer the Margin Trading Facility (MTF) to Non-Resident Indians (NRIs).
You can execute Margin Funding in the following 2 ways:
There are certain facts about Margin Trading that you must remember before you opt for the Margin Trading Facility. Take a look at them:
At present, only Tradeplus is there which offers Margin Trading for NRIs with a brokerage charge of 0.40% (NRE) / 0.30% (NRO).
To conclude, without ideal guidance, it isn’t easy for NRIs to trade in the Indian stock market thanks to some limitations.
Therefore, if you are an NRI then before you execute Margin Trading in India, you must avail of proper guidance of market and legal experts to attain a hassle-free investment experience.
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