I am new in trading and want to trade in Futures. I used the span calculator for that and get the following result :
Buy 1 lot Sell 1 lot
Initial margin 31,225 30,983
Exposure margin 18,729 18,772
Total margin 49,954 49,755
I have some general doubts regarding this result.
When I am buying (Not intraday, I want to take position) :
Do I need at least the total margin amount 49954 in my trading account ?
Suppose I have free cash of Rs. 1,00,000 in my trading account. If I buy 1 lot, what would happen to this amount?
When I am selling :
- I can understand that the broker charges exposure margin for any potential loss while buying. But when I am selling the future contract why again there is a margin amount ?
Could you please resolves these doubts. Thanks in advance.