Hi, can i pledge G sec bonds for tading in equities in Dhan. where can i buy G sec bonds in Dhan? how much will be deduted as margin if i pledge the G sec bonds.
Regards
Rajanikanth
@kanth5574 Yes you can pledge G-Secs for trading in equities and derivatives in Dhan.
Please find the list of G-Secs here which are available for pledging. The list gets updated based on our Risk Policy.
How to Find G-Secs on Dhan?
For example, you need to find 610GS2031. The security name would be “GOI LOAN 6.10% 2031”. We have used custom symbol name for underlying securities so that nomenclature discrepancy does not affect the users. Nomenclature logics change at exchange level which brings in confusion. Just type “GOI LOAN” on the search bar and you will get all the Government Securities listed.
Note: All G-Secs have a standard haircut of 10%. So for every 100 invested in G-Sec, you will get a value of Rs. 90 as CASH equivalent collateral which can be used as margin.
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Hi,
Thanks for the response. Can i use it for trading in equities as i don’t do options, future and intraday. what would be the charges for pledging?
Regards
Rajanikanth
Is there any interest charges apart from this ?
Nope. Citing an example to help you understand:
Assume you bought G-Secs worth Rs. 10L, post haircut you get margin of Rs. 9L.
For Intraday in Equity - Margin needed is 20%
Hence, total trade value can be of Rs. 45L. Here since the trades will be closed intraday, there will be no interest payment.
For BTST in Equity - Margin needed is 100%
Hence, total trade value can be of only 9L. Since you have bought the securities of 9L on T-day, you need to make a payment of 9L for the said securities on T+1 day. The margin was only used to allow for trade. Now in this case, DPC (delayed payment charges) will be applicable for the T+1 day.
For Positional in Equity - Margin needed is 100%
Hence, total trade value can be of only 9L. Since you have bought the securities of 9L on T-day, you need to make a payment of 9L for the said securities on T+1 day. The margin was only used to allow for trade. Now in this case, DPC (delayed payment charges) will be applicable from the T+1 day to the time securities are sold.
The DPC charges are 0.0438% per day.
Hello, I had a generic question on buying these GSec bonds via Dhan. Will these bonds payout fixed interest to my linked bank account at regular intervals ( I believe its every 6 months for long dated GSec bonds) ? Or they will just keep rising in price similar to Growth Mutual Funds
@Lumiaman88 yes, the interest is paid directly to your linked Primary Bank account on Dhan every 6 months. Since there are scheduled auction for sale for the Government Securities, intertest payment dates vary. They can be found on the RBI Website under Notifications section (Link).