What is Peak margin and how does it affect Payout?

What is Peak margin and how does it affect Payout?

Peak Margin is the minimum margin that MUST be collected by brokers from their clients in advance of placing any intraday/delivery order in the Cash and derivatives segment. Clearing corporations will randomly take 4 snapshots at predefined time windows for arriving at such peak margin requirements on open positions during the day.

The highest margin requirement from these 4 snapshots will be the Peak Margin. This aims to curb the excessive leverage for intraday and derivatives positions.

Intra-day positions will now need upfront margins. Also, if a trader falls short of these margins during the session, he would be liable to pay a penalty.

HOW PEAK MARGIN AFFECTS PAYOUT -

You will get a maximum 80% payout of your available cash margin after deducting the peak margin.

Let's understand it with the below example -

Your peak margin of a specific day is Rs 10 lakhs.

The available cash margin is Rs 15 lakhs

Available cash margin - Peak Margin = Gross payout amount

1500000 - 1000000 = 500000 Rs

So, you will get a payout of 80% of 500000 that is Rs 400000 (Net Payout amount).

Note -

- In case your peak margin is equal to or higher than your available cash margin, your payout will be rejected for that specific day.

- Even if you have squared off your positions, still the payout will be calculated on the basis of the peak margin rule.

- You can check your peak margin in the Infinn "View Limit" option.

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