What is SPAN and exposure margin?

Two essential elements that together make up the initial margin needed to enter a position in futures and options (F&O) trading in India are the SPAN margin and the exposure margin.

• Standard Portfolio Analysis of Risk, or SPAN Margin, is the bare minimum needed to offset possible market-movement losses. Determined by the exchange using risk models (such as NSE/SPAN). depends on how volatile your trades are and how big your positions are.

• Exposure Margin: An extra safety net above the SPAN margin.

set by the exchange to guard against unforeseen changes in the market or black swan situations.

typically a set percentage of the agreed-upon amount.

What is a daily margin statement, and how to understand it?

The Securities and Exchange Board of India (SEBI) requires stockbrokers in India to provide their clients who trade on margin (futures and options, or even some equity cash segments with leverage) with a Daily Margin Statement, a critical financial report. In essence, it's a daily summary of the condition of your trading account, with an emphasis on your margin situation.

What is F&O Margin?

The minimum sum of money or collateral required to open and maintain positions in futures contracts and short (selling) options contracts is referred to as the "margin" in the context of Futures & Options (F&O) trading in India.