5.7How does intraday trading work?
Time-sensitive: SEBI peak-margin rules (20% minimum for equity intraday) as of November 2026. Rules and rates change, so check the official source before acting.
1What is it?
You choose product MIS/Intraday, and the broker blocks a margin (a part of the trade value). You must close before the cut-off, or the broker closes it for you.
2Why does it exist?
Because the position is closed the same day, no delivery happens, so the broker can allow a smaller upfront amount. SEBI caps intraday leverage for equities at 5× (20% margin) for most stocks.
3Calculation
Margin needed ≈ Trade value × margin %
- Buy ₹1,00,000 worth intraday with 20% margin.
- Margin blocked = ₹20,000.
With ₹20,000 you control ₹1,00,000, so a 1% move = ₹1,000 = 5% of your money.
4Quick revision
- MIS product; margin blocked.
- Max ~5× leverage in equity intraday.
- Close before cut-off.
5Knowledge check
Q1. Max intraday leverage on most equities?Show answer
5× (20% margin).
Q2. With ₹10,000 margin at 5×, max position?Show answer
₹50,000.
Q3. What happens if you don’t close?Show answer
The broker auto squares off.