Margin Calculator

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What is a Margin Calculator?

Understanding margin requirements is essential before trading in Futures & Options. A margin calculator is an online tool that helps traders estimate the capital required to place F&O trades. It enables you to plan trades efficiently and avoid margin shortfalls.

The margin calculator can be used for futures and options buying or selling, as well as for different trading strategies across equity, commodity, and currency markets.

Types of Margins

SPAN Margin

SPAN (Standardized Portfolio Analysis of Risk) is the primary margin required for Futures & Options trading. It represents the maximum potential loss a portfolio may face under different market scenarios. SPAN margins are updated multiple times during the trading day.

Exposure Margin

Exposure margin is an additional margin collected to safeguard against adverse market movements and to manage overall trading risk.

Value at Risk (VaR) Margin

VaR margin estimates the likelihood of loss in an asset based on its historical price movements and market volatility.

Extreme Loss Margin

Extreme loss margin accounts for losses beyond VaR limits and is calculated as the higher of:

  • 5% of the total position value
  • 1.5× standard deviation of daily logarithmic returns over the past six months

How to Use the Margin Calculator

The margin calculator evaluates different margin components based on your trade inputs. Follow these steps to estimate the margin required:

  • Select the exchange – NFO, CDS, MCX, or NCDEX
  • Choose the product type – Futures or Options
  • Select the trading symbol (index or stock contract)
  • Enter the net quantity you wish to trade
  • Choose whether the position is Buy or Sell

Based on these details, the calculator displays the combined margin requirement along with individual SPAN and exposure margin values. This helps ensure smooth and hassle-free trading in F&O markets.