Initial Margin
The upfront capital you must deposit before the exchange lets you open a futures or short option position.
Definition
Initial margin is the minimum collateral you must have in your account before you can open a leveraged position in the futures and options segment. In India it is the sum of the SPAN margin (the modelled worst-case portfolio loss) and the exposure margin (an extra buffer). The exchange blocks this amount upfront and holds it as long as the position is open.
Why it matters
Initial margin is what actually limits how many lots you can take with a given amount of capital. It is a snapshot of risk at entry and changes with the underlying's price and volatility — a position that needed less margin last week may need more today. Once you are in, daily mark to market moves can erode your balance below the required level, triggering a top-up demand.
Example
To sell one lot of an index future, suppose SPAN margin is about Rs 90,000 and exposure margin is about Rs 20,000. The initial margin is roughly Rs 1,10,000, which must be in your account before the order is accepted. With Rs 2,20,000 of capital you could carry two such lots, with little buffer left for adverse moves.
See it live
Watch index and option positioning in real time on TradePulse's live option chain before you lock up initial margin.