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Mangal Keshav Exposure/Margin Limit Review 2024

Mangal Keshav Financial Service LLP is a well-known stock broking company that offers a wide range of financial services including commodity trading, currency trading, equity trading, derivatives trading, NRI service, advisory services, and portfolio management services. In addition to these services, Mangal Keshav financial services ltd also offers margin/exposure funding to its clients. Mangal Keshav Margin/Exposure refers to the number of funds an investor or trader must maintain in their trading account to cover the potential losses that may arise from their trading activities. It is an essential aspect of margin trading, which involves borrowing money from a broker to purchase stocks or other securities. Mangal Keshav margin or exposure requirements vary depending on the type of securities being traded and their risk level. For instance, stocks with high volatility and low liquidity require higher margins than those with stable prices and high trading volumes. Mangal Keshav owner improving and updating Mangal Keshav services day by day.

Mangal Keshav Margin/Exposure Limit List

What is margin trading in Mangal Keshav?

Margin trading is a technique that allows investors to borrow funds from a brokerage firm to buy securities. It amplifies buying power, enabling investors to trade with more capital than they possess. By leveraging borrowed money, investors can potentially increase their returns if the securities' prices rise. However, margin trading carries risks as well. If the securities' prices decline, investors may experience significant losses that exceed their initial investment. Margin calls can occur if the value of the investor's portfolio falls below a certain level, requiring additional funds or position liquidation.

Advantages of Margin Trading 

• Increased buying power: Margin trading allows investors to leverage their trading capital and potentially increase their buying power. They can trade larger quantities of securities than they could with their own funds alone.

• Potential for higher returns: Using borrowed funds, investors can amplify their gains if the price of the securities they hold increases. Margin trading allows investors to benefit from potential market opportunities and increase their returns.

• Short selling opportunities: Margin trading enables investors to engage in short selling, which means they can profit from the decline in the price of a security. This can be advantageous during bearish market conditions.

• Diversification: Margin trading allows investors to diversify their portfolios by gaining exposure to a broader range of securities. They can invest in different sectors or asset classes, spreading their risk across multiple investments.

Disadvantages of Margin Trading 

• Increased risk: While margin trading offers the potential for higher returns, it also exposes investors to higher risk. Trading on margin heightens both returns and losses. If the price of the securities declines, the investor may experience significant losses, potentially exceeding their initial investment.

• Margin calls: Margin trading requires always maintaining the required margin. If the value of the investor's portfolio falls below a certain threshold, the broker may issue a margin call, demanding additional funds or the liquidation of positions. Failure to meet a margin call can result in the loss of the investor's positions.

• Interest costs: Borrowing funds for margin trading incurs interest charges. The investor is responsible for paying the interest on the borrowed funds, which can reduce their overall profitability.

• Regulatory limitations: Margin trading is subject to regulatory guidelines and restrictions. Margin requirements can change, and brokers may impose their own rules and limits, which can impact the investor's trading strategy and flexibility.