What are the different orders types offered by Zerodha?

Zerodha offer different order type for different segments. Before going into it, let’s first see the segments that Zerodha offer trading.

The various segments are:

  • NSE : for NSE Equity
  • NFO: for NSE Futures & Options
  • BSE: for BSE Equity
  • BFO: for BSE Futures & Options
  • MCX: for Commodities
  • CDS: for NSE Currency Derivative Segment

Now dig in to see various product type with Zerodha depending on the segment you want to trade in:

Trading in Equity Delivery on NSE / BSE

    CNC (Cash n Carry): You have to choose CNC to trade in Equity Delivery segment.  For using CNC product type, you need to have a demat account mapped to your trading account with Zerodha. There is no leverage given for trading using CNC as product type. With CNC, you buy the stock and hold it overnight, so you would require a demat account to take delivery of the stocks you purchase.

Trading in Equity Intraday on NSE/ BSE

    MIS (Margin Intraday Square Off) : Intraday Equity Trading means that you take a trade in equity and square off the position before end of  the day. Intraday trading with Zerodha can be done by using product type MIS. You get a leverage between 3 to 14 times based on the risk and volatility of the stock. 

    CO and BO: Cover orders and Bracket orders are special order types at Zerodha where you can trade intraday  with a definite and compulsory stop loss.  In a CO you can place intraday buy/sell market orders with a compulsory stop loss for higher leverage. When you trade intraday using cover orders with Zerodha, the leverage you get vary from 6 to 20 times (twice as much as MIS).

Trading in Futures - Equity (Index and Stocks), Currency and Commodity

    While trading futures at Zerodha you can use 3 product types:

    NRML

    NRML is a Overnight/positional or intraday product type for future contracts.  Once a position taken as NRML, it can be held till the expiry provided the requisite NRML margin present in the trading account.

    If you don’t want any excess leverage, use the product type NRML and you would not have to worry about auto square offs.

     

    MIS (Margin Intraday Square off)

    MIS is used by intraday traders as all open positions get squared off before the end of day. But since no position is carried forward overnight the margin required is also lesser than the exchange stipulated margins.

    For equity & Index futures, MIS margin: 50% of NRML margin, all MIS positions squared off around 3.20pm.

    For Commodity futures, MIS margin: 50% of NRML margin, all MIS positions squared off about 25 minutes before market closing

    For Currency futures, MIS margin: 50% of NRML margin, all MIS positions squared of around 4.30pm.

    CO and BO: Cover and Brackets are unique orders at Zerodha where you can trade intraday but with a definite and compulsory stop loss. Using Cover and Bracket orders, you can trade futures with lesser margins than NRML and MIS. 

Trading in Options - Equity (Stock & Index) and Currency

    Zerodha doesn’t provide any additional leverage for options trading. So if you are buying calls or puts of any contract, the premium required to buy them has to be present in your trading account. You can trade options either with product type as NRML or MIS, but since there is no additional leverage provided if you use product type as MIS, it is advisable not to use MIS while buying options since all MIS positions would get squared off before the close of markets.

    Note:

    Because of illiquidity of stock option contracts, market orders have been disabled on stock options. Only limit orders are allowed.  Place a limit buying order higher than the current price or selling order below the current price, this will act as good as market order but will also protect from any impact cost due to illiquidity. You can place market orders on index options.

Different Order Type with Zerodha

Market Order

    Market Order with Zerodha is an order to buy or sell a contract / stock at market prices. The price is not specified at the time of placing the order.

    The advantage of the Market Order is that the order will definitely be executed all the prevailing market rate, however, the trader might end up paying slightly more or selling at a slightly lower price.

Limit Order

    Zerodha’s limit order is an order to buy or sell a contract at a specified price. When you are buying, you instruct your broker not to go higher than the specified price. And when you are selling you instruct your broker not to sell below your specified price.

    When placing Buy Limit orders, the limit price entered must be below the Current Market price

    When placing Sell limit orders, the limit price entered must be above the current market price

Stop-Loss Order

    A stop-loss order with Zerodha is a buy / sell order placed to limit the losses when you fear that the prices may move against your trade. If you have a buy position, then you will place a sell SL.  If you have a sell position, then you will place a buy SL

    Types of Stop-Loss orders:

    Stop-Loss Limit Oder or SL Order

    In this order type with Zerodha, you have to enter price + Trigger Price. When the trigger price is hit, the stop-loss order is sent as a limit order with the limit price mentioned by you in the SL order.

    SL-M Order or Stop-Loss Market

    In stop-loss Market order, you only need to enter trigger price. The order is sent as a Market order, when the trigger price is hit.

Answered on

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User Comments

avatar
1. Nishan singh  Dec 15, 2018 9:20:26 AM IST Reply
CO and BO are really good with Zerodha, As intraday Trader, Its worth to trade with Zerodha. Great Margin and Great Tool.

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