What is a NRML Order in Trading?
NRML or the Normal Margin (Full Form of NRML) order is used for carry forward trades in the derivative segment and for a special product in Samco called “Cash Plus” in the Cash segments. For example if some body wishes to buy Nifty futures and sell in after a few days he can do so using the NRML product type. NRML trade can be converted in to an MIS order from the Position conversion window. Intraday trade in the MIS product type can also be converted into a NRML trade provided the required margin is available in the clients trading account.
In the derivatives trade, the margins applicable would be the total margin i.e. SPAN + Exposure. The margin can be checked from the Span Calculator. In derivatives, no extra leverage is provided for trades using the NRML product. In contrast in the equity segment, the NRML product is used for providing leverage upto 4x on selected stocks. You can check the NRML order margins for the Equity Cash Segments on the Equity Delivery Leverage Calculator.
Note that the margin applicable while entering the order is only initial total margin and additional mark to market would be required to be paid if there is a loss in the position. If the clients trading account balances drop by 80%, the open positions would be squared off by the RMS system.
You should check the Samco margin policies and limits to check the margins available for trading different product types with Samco.
The Other Order types in Derivatives Segment and Cash Market Segments are
- MIS Orders – Margin Intraday Square-off for Intraday Trades
- Bracket Orders for Intraday trades
- Cover Orders for Intraday trades
- CNC Orders – Cash and Carry Orders for Delivery buy/sell transactions (Only available in the Cash market segments)
Disclaimer – Trading with NRML orders involves the use of financial leverage. Margin Trading with NRML orders carries a high degree of risk and it magnifies a trader/investors gains and losses. Trading with Margins can expose the client’s capital to substantial risk and in certain cases, a client may sustain a total loss of capital. A client should know the risks of financial leverage and should consult their financial advisors to ensure that the use of the same is appropriate and in accordance with the client’s risk appetite and financial position.