What is Initial margin in F&O trading?

Initial margin is the margin required to be maintained in your account to take a F&O trade. Before initiating any F&O trade, you must have initial margin, usually 50% in your account. When you place order, your broker will block the initial margin.

• Initial margin = SPAN Margin + Exposure Margin
• Span margin=% of contract value
• Exposure Margin = % of contract value
• Contract Value=lot size* futures prices