Angel One users often think about using the margin trading facility (MTF) offered by this brokerage platform. However, many of them end up speculating about Angel One MTF charges and give up on their initial thought.
Yes, it’s true that traders need to pay Angel Broking MTF interest rate and charges. But they are not very high. Let’s discuss them here!
What are MTF Charges in Angel One?
Angel One users need to pay a certain interest rate and pledging charges on opting for the MTF facility. Here are these:
MTF Interest Rate
0.049% per day (18% per annum)
MTF Pledging Charges
Rs. 20 + GST (per ISIN)
The above table shows the MTF charges in Angel Broking levied on traders on the borrowed amount. A trader needs to pay an interest rate of 0.049% as MTF charges per day on Angel broking.
Annually, it accumulates to reach 18% annually for traders. If you use this facility, you need to pay this interest from the 2nd day after opting for the MTF facility.
And you are liable to pay it until the clearance of your outstanding amount or the squaring off of your position. Let’s understand this with an example!
Suppose, you have just Rs. 10,000 in your trading account and want to trade in ABC company with Rs. 100 as the CMP of each share.
If you opt for a 3X margin for delivery trading using Angel One, then you will get additional 3X i.e, Rs. 30000 margin for trading activities.
Now, you have a total of Rs. 40,000 in your trading account and it increases your chances of making more profit.
Suppose, you buy shares by investing your Rs. 40,000. Then, the total number of shares you will get are:
Let’s assume the stock price rises from Rs. 100 to Rs. 120 after 30 days. Then, you will gain per share profit as follows:
Profit = (120-100)*1 = Rs. 20
So, your total profit would be:
Total Profit = No. of Shares * Profit Per Share
= 400*20= 8000
Total interest paid for 30 days on Margin amount of 30,000 = 30000*0.049%*30 =Rs. 441
This is the amount of Angel One MTF charges you need to pay for 30 days.
For the calculation of net profit, you need to deduct the margin interest rate charged by Angel One.
So, in this case, the net profit would amount to:
Net Profit= Profit – Margin Interest
= 8000 – 441
= Rs. 7559
In the case of MTF Pledging, you are liable to pay a small amount of Rs. 20 + GST per ISIN for pledging of shares or unpledging of shares.
Now you know that Angel One MTF charges are just a small amount that traders pay for availing Margin. And you can use the Angel Broking MTF charges calculator to find the total sum you need to pay on your borrowed money.
If utilised well, margin trade facility can help any trader multiply the overall profit greatly. But you need to keep in mind that, as a trader, you can only opt for the MTF facility in the case of equity shares.
Also, remember that MTF Facility is applicable ONLY for trading in equity shares/stocks.
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