Finding a high-margin broker in Indian markets is similar to looking for a unicorn. This is due to the legal environment and mandatory brokerage slabs. In the US stock market, brokers vie for the highest margin offering and have a clear winner declared every quarter. However, in India, the margin slabs are set as per the latest guidelines by SEBI itself and may not help top brokers outdo each other. So how to navigate through the margin landscape in India to get the most trading out of your funds?
What is the Margin in the Stock Market?
Margin is a loan provided by your broker to boost your buying power. It helps you buy more shares and contracts than your account balance permits. There are two major types of margins in India:
Delivery Trading Margin: You buy stock and want to hold it for a longer term. The minimum margin requirement is 50% of your buying position.
Intraday Trading Margin: You buy stock and sell it before the market closes. Here, the minimum margin requirement is 20%.
So what we have with the exchange is just a floor on the margin requirements. The actual margins that investors are offered depend on many other factors, such as:
Account Type: Speculative margin trading may be limited to experienced investors who meet much higher minimum balance requirements.
Creditworthiness: A broker is likely to consider your credit history and your current income when deciding how much margin to offer you.
Stock Volatility: A volatile stock with a high beta will often carry lower margin requirements, leaving the customer to pay for the added risk of a more stable stock with a greater investment of his or her funds.
So which brokers are offering the high margins?
With margin minimums set by regulators, brokers add value in terms of service, trading platform and special attention to certain investor groups. Lares Algotech is among the brokers that lead the way.
Lares Algotech: Redefining High-Margin Experience
Lares Algotech understands the Indian investor’s needs. They go beyond just offering the highest possible margins (which, as we’ve established, is subject to regulations). Here’s what sets them apart:
Tailored Margin Solutions: Lares Algotech works with you to understand your goals and risk appetite. We then work collaboratively with you to develop strategies to have the margin, the rest comes naturally.
Advanced Algorithmic Trading: Our state-of-the-art platform uses complex statistical algorithms to weed out the weak trades and optimize the leverage available. Our system takes into account extensive factor models to arrive at the most efficient allocation of leverage.
Geared Towards the Experienced Investors Lares Algotech is for experienced margin traders who understand the dangers and the upside of the opportunity. Our platform is tailored to the most sophisticated of clients.
Risk Management Tools: We are serious about the integrity of your portfolios, we have a full arsenal of risk management tools including stop-loss orders, margin alerts, and more.
Choosing the Right Broker
Margins are important, but not the only criterion to choose a broker. Here are some other factors to consider:
Brokerage: Make sure that brokerage fees are competitive. While you want high margins, you also want to keep as much profit as possible, e.g., a player like Lares Algotech charges the lowest brokerage fee.
Trading Platform: The trading platform should be intuitive and feature-rich. Lares Algotech offers an advanced feature-rich platform suitable for all types of traders.
Customer Service: When something goes wrong with your trade, there should be someone to help you out. Lares Algotech has superior customer service.
Indian stock markets have their own margin rules. While the minimums are dictated by the regulation, the kind of margin use introduced by firms like Lares Algotech is groundbreaking. Known for providing high margin, advanced technology and risk management features – Lares Algotech can be your go-to for an ideal trading experience. But remember, high margins don’t guarantee the best trading experience. Having a balanced approach combined with the backing of an experienced investor will always result in better performance.
