Margin is when a broker provides you with more purchasing power than what is available in your account. The terms "margin" and "exposure" are often used interchangeably. If a broker offers "2x exposure," it is essentially providing "50% margin."
For example:
Let's assume you have ₹10,000 in your trading account, and your broker is providing you with a 50% margin (2x exposure) on Equity Intraday. This means that if you intend to place a trade worth ₹10,000, and the Exchange requires the full ₹10,000 from the broker, only 50% of the trade value (i.e., ₹5,000) would be debited in the transaction. However, it's crucial to exit your Intraday position by the end of the trading day.
Many brokers stipulate a "minimum" or "initial" margin, indicating the minimum amount to be maintained in the trading account.
For example:
A broker might set an initial margin requirement of ₹10,000, signifying that you must maintain at least ₹10,000 in your trading account at all times.
Brokers can provide different levels of exposure for various segments of products.
** Index and stock futures
Index and stock option sell
NSE Currency Futures
MCX Futures