Hi ,
I trade positional option selling. I often deploy up to 90% margin.
I have pledged my assets in the following way.
47% – Equity Mutual Fund
33% – Debt Fund
20% – Cash
I only trade fully hedged neutral positional index options selling, to collect theta.
Since I know the max probable loss. I keep margin in my account around that value to prevent the margin call.
But now I think, what will happen if Nifty hits the lower circuit 
? I haven’t experienced a circuit yet.
-
When circuit hits, wouldn’t the value of the pledged asset go down decreasing the margin availability and triggering the margin call ?
-
Since I hold only mutual funds which change once a day. Am I saved from the intraday margin fluctuation?
-
Have anyone experienced a circuit while holding option selling position ? How will our trades behave then ?
I am thinking of modifying my pledge asset allocation the following way ?
20% – Equity Mutual Fund
35% – Debt Fund
35% – SGB
10% – Cash
- Should I allocate my assets to pledge differently ?
