Why some brokers give only 1x leverage on MIS (intraday) for most of the stocks? (2024)

FAQs

Which broker gives the maximum leverage for intraday? ›

Astha trade provides one of the highest margin in the stock broking industry, especially in crude oil. In the equity intraday segment, the company provides a margin of up to 40 times & the highest option of selling margin in India.

Intraday (MIS/CO) orders are not allowed for some stocks due to regulatory or risk management reasons.

Since leverage trading allows you to purchase more shares, you get the chance to get higher returns on your investment. For instance, with a 5x leverage, you can purchase 5 times more shares. And if the market moves in your favour, you stand to gain 5 times more return on your investment.

In the markets of forex, the common leverage used is 100:1, considered high. What this essentially means is that for each $1,000 in your trading account, you are permitted to trade till $100,000 of currency value.

Delta Exchange

Delta Exchange offers perpetual and inverse futures contracts on over 50 cryptocurrencies, with up to 100x leverage. It also supports Bitcoin and Ethereum options with daily and weekly settlements. Pros: High leverage options, diverse contract types, supports major cryptocurrencies.

When a stock hits the upper circuit price, there are only buyers in the market, and no sellers are available. This means that it becomes difficult to repurchase the stock that was initially sold for intraday trading. As a result, the intraday trade automatically converts into a delivery trade.

But stockbrokers may impose restrictions on these orders for specific stocks to mitigate potential risks. As a result, traders are limited to placing (CNC) orders for these particular stocks. Blocking MIS orders is primarily driven by the high risk associated with being unable to exit an intraday position.

Not Setting Proper Trading Limits

In intraday trading, the success lies in managing the risk. You should pre-define a stop loss and profit target when entering intraday trading. This strategy itself is an important part of trading discipline and this is where most people fail.

m.Stock's Margin Trading Facility (eMargin) has one of the lowest interest rates starting at 6.99% p.a. for funding above ₹5 crore. For funding up to ₹5 crore, 9.99% p.a.

How much leverage is too high? ›

A leverage ratio higher than 1 can cause a company to be considered a risky investment by lenders and potential investors, while a financial leverage ratio higher than 2 is cause for concern.

You can use 20X leverage and still lose only 2% of your capital if your optimal stop is hit, assuming the financial instrument is liquid enough and creates very little slippage, even when the market is moving fast.

As I continue to say, leveraged trading comes with significant risks because while it can increase your gains, it can also magnify your losses. If you have a low-risk tolerance or you're uncomfortable with the idea of substantial losses, leverage trading may not be suitable for you.

On paper, intraday trading looks risky but in reality, you trade with stop losses and profit targets so your risk is automatically reduced in terms of maximum losses that can happen. Intraday trading is like borrowing from the market without paying any interest and to that extent, it is much better than margin funding.

Suppose you are interested in using 1:1000 leverage. In that case, you can open a Ticktrader account at FXOpen International with 1:1000 leverage. Hence, it is possible to trade with lower margin requirements to access the CFD market and choose any instrument, and start making money from online trading.

Zerodha, Upstox, Angel One, Sharekhan, Fyers are a few of the top intraday trading brokers that offer online trading at Rs. 20 per order flat brokerage charges. Among all, Zerodha is the best broker for day trading based on the following facts; Lowest Intraday brokerage charges at Maximum Rs.

Say, you have Rs 10,000 to invest in a trade and you are being offered a 10x margin trade rate by your broker. In simple words, with only Rs 10,000 to invest, by engaging in day-trading margin, you can participate in a trade with a value of Rs 1,00,000.