NEW DELHI: Paytm Money, the subsidiary of payment solutions provider Paytm, has launched a new feature called ‘Margin Pledge’. This new feature will enable users to pledge their existing stocks and ETFs in return for a collateral margin that can be used for trading in stocks, ETFs, futures, and options.
Margin Pledge is a process in which users can pledge their stocks to the broker in return for a collateral margin that can be utilized for trading. For instance, an investor who holds shares worth Rs 2,00,000. Now a trading opportunity arises but due to lack of funds, the investor is unable to seize it. The user can pledge his or her existing stocks to the broker. The broker deducts a haircut of say 20% from the total value of stocks, ie Rs 40,000 and gives the remaining value of Rs 1,60,000 as a collateral margin which can be used for trading opportunities.
The company mentions that the collateral is received within 30 minutes during trading hours and collateral calculation is done in real-time. Pledged stocks remain in users’ demat accounts, are eligible for all corporate actions, and can also be sold directly. A minimal charge of Rs 10 + GST per stock will be imposed on each pledge and unpledge request.
This feature is accessible to select users and is being rolled out to more users. The feature is currently available on Android and Website and will be available on iOS soon.
Recently, Paytm Money introduced a wealth and investment advisory marketplace on its platform to offer curated advisory services and products to retail investors. Paytm Money has partnered with start-up WealthDesk to offer investment portfolios called ‘WealthBaskets’ as the first step to build up the advisory ecosystem.
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