Why does 5Paisa square off positions?

Why does 5Paisa square off positions?

5Paisa square off for various reasons. Here are some reasons to help you understand why it is done:

Scenario 1: T+6 Debit Square Off

  • Timing: Daily at 3:15 pm
  • Criteria: Square off for clients purchasing NON-APPROVED Stocks.
  • Exception: Debit less than 1000.

Scenario 2: T+90 Debit Square Off

  • Timing: Daily from 3 pm onwards
  • Criteria: Selling for outstanding debit balance for over 90 days.
  • Exception: Debit less than 1000.

Scenario 3: Risk-Based Square Off

  • Timing: Daily from 9:15 am onwards
  • Criteria: Square off of debit balance for GHVC <20%.
  • Thresholds: Liquidation percentages based on GHVC.

Scenario 4: DPR-Based Square Off

  • Timing: Anytime during the day
  • Criteria: Square off for short positions nearing the DPR threshold.
  • Thresholds: Based on DPR tiers (4%, 8%, 16%).

Scenario 5: Intraday Square Off

  • Timing: Daily from 3:20 pm onwards
  • Criteria: Squaring off all intraday product positions.
  • Process: The automated system stops further intraday orders at 3:19 pm.

Scenario 6: Real-time Risk-Based Square Off

  • Criteria: Losses eroding more than 50% of Net worth.
  • Process: The automated system squares off all open positions.

Scenario 7: FNO Shortage Square Off

  • Criteria: Liquidation on a T+1 basis for MTM debit/margin shortfall.

Scenario 8: Physical Settlement in Equity Derivatives

  • Timing: Before the day of the last expiry in a month
  • Criteria: Square off as per SEBI circular on physical settlement.

Scenario 9: Commodity Square Off

  • Criteria: Intraday square off, Auto Square off System (MTM based), Margin Squared off (Shortage), Physical delivery.
  • Note: Positions may be squared off without prior intimation due to market volatility or regulatory requirements.

Additional Notes: It's advisable to credit funds via UPI and IMPS to clear the debit balance, as updates are done on a real-time basis.

This comprehensive overview ensures clarity regarding the risk team's square off procedures in various scenarios during trading.


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