It is the mechanism of buying stocks by partly putting in your own money(either in cash or securities) and the rest being funded by the broker. You can buy larger quantity of stock with the same amount of funds.
Features of Margin Trading facility:
Easy online MTF activation: There is no paper formality for MTF activation. Easy online MTF registration through Anand Rathi website/back office
Additional exposure on existing investments: Margin trading facility is simple option to leverage your existing portfolio, it allows to invest with a small amount either be it in cash or in collateral form it helps to enhance investors’ purchasing power.
Interest: Interest is charged only for the days the loan amount is utilized.
Better returns: MTF improves the rate of return on the capital invested.
No prepayment charges: Investor can prepay the loan amount since this facility is in the nature of an overdraft facility.
Dividend & other corporate action benefits: Investor not only retains the ownership but also continue to avail of the shareholder benefits such as dividends, bonuses, rights, etc.