The Securities and Exchange Board of India (Sebi) is planning to introduce an integrated risk management system (IRMS) that would facilitate cross-margining of positions across bourses.
This will include positions in the equity and derivative segments and also across two products such as Nifty and Sensex futures.
In other words, if a broker holds a long position in one share on one exchange and a short position in the same stock in another, his margin requirements can be netted out.
Margins are risk-containment measures implemented by bourses. By collecting margins from brokers (who may, in turn, collect them from their clients), the stock exchange ensures that if there is a default, it has the wherewithal to honour the trade. Margins can be paid before, during or after a transaction. Bourses normally collect three types of margins