Cover
Order is a facility where the clients can trade in Futures Market with minimum
margin, even less than 1%.
At
the time of taking intraday cover order position client has to place stop loss
order also.
The
margin required is lot size or quantity multiplied by 2 times of the difference
between buy/sale price and stop loss price , decided by the clients as per
their requirement.
For example – If client wants to
take a intraday long position in nifty futures. Currently Nifty Dec 2016 futures trading at 8000 and client decided to set the stop loss at 7990, then
the margin will be required 1000 Rs only ( difference of buy price 8000 – stop
loss price 7990 = 10 points * 2 times * 50 lot size of nifty).
The
client has option to exit from the position before the stop loss is triggered.
If
the market is stable, client does not exit from the position or stop loss also
not trigger then all the Cover Order positions will be auto squared off at 3.15
P.M.
All
Cover Orders will be executed at current market price only. Limit order is not
permitted.
Cover
Order facility is available on selected future contracts as per liquidity.
This
facility can be available between 9.15 A.M to 3.10 P.M only.
Stop
loss price or order cannot be modified from any branch or admin terminal.
Client
cannot carry or convert the Cover Order position after giving addition margin
also.
In
this case the clients need to exit from current Cover Position then take fresh
position selecting CNC or NRML.
Cover
Order facility is also subject to market conditions. If the market is very
volatile on a particular day, the company can disable the facility for that
day.
This
facility will be available for both online and offline clients.