How to use the basket order for multi-leg options on Kite
The basket order feature on Kite allows you to prepare and submit up to ten orders in a single click, making it the standard tool for entering multi-leg options strategies where each leg must be placed as close to simultaneously as possible. This guide explains how to build a basket, set prices, and manage the submission, including what to do when legs fill partially.
For building the strategy before execution see How to build an options strategy on Sensibull. For exiting an existing multi-leg position see How to exit a multi-leg F&O position on Zerodha.
Why use basket orders for multi-leg strategies
A multi-leg options strategy (straddle, strangle, bull call spread, iron condor, calendar spread) consists of two or more option contracts that work together to produce a specific payoff profile. Placing each leg one at a time exposes you to leg-risk: the risk that the first leg fills at an acceptable price but the market moves before the second or third leg can be placed, so the second leg fills at a much worse price or the order is rejected entirely.
The basket order mitigates leg-risk by queuing all legs and submitting them simultaneously in a single click. While there is still no atomic guarantee (each leg is a separate NSE order that may fill at different times), the time gap between submissions is reduced to milliseconds, far shorter than manual sequential order placement.
Common strategies executed via basket order:
- Short straddle: sell 1 ATM CE and 1 ATM PE.
- Short strangle: sell 1 OTM CE and 1 OTM PE.
- Iron condor: sell 1 OTM CE, buy 1 further-OTM CE, sell 1 OTM PE, buy 1 further-OTM PE (4 legs).
- Bull call spread: buy 1 lower-strike CE, sell 1 higher-strike CE.
- Calendar spread: buy far-month CE, sell near-month CE at the same strike.
Step-by-step procedure
Open Basket Orders in Kite
Log in to Kite. Click Basket Orders in the top navigation bar (it appears between “Market Watch” and “Orders” in the standard layout). The Basket Orders panel opens on the right side of the screen.
Alternatively, if you designed the strategy in Sensibull, clicking the Execute or Place Order button in Sensibull automatically opens the Kite basket order panel pre-filled with all legs.
On the Kite mobile app, access basket orders via the menu icon (top right) → Basket Orders.
Add legs to the basket
In the basket panel, use the search box to find each contract. For options, type the contract code directly (for example NIFTY26JUN24000CE) or the underlying symbol and navigate to the relevant option via the search suggestions.
Click the + Add button (or tap the instrument) to add it to the basket. A row for that contract appears in the basket table.
For each leg, configure:
| Field | How to set it |
|---|---|
| Transaction type | Buy (B) or Sell (S) |
| Product type | NRML for overnight, MIS for intraday |
| Order type | Limit (recommended) or Market |
| Quantity | Number of lots × lot size, expressed in shares (Kite shows quantity in shares by default; confirm against the lot size for the instrument) |
| Price | Limit price; leave blank for market orders |
| Disclosed quantity | Optional; leave blank unless there is a specific reason to hide the full order size |
Repeat the search-and-add process for each leg until all legs of the strategy are present in the basket.
Set prices for each leg
For index options (Nifty, Bank Nifty, Sensex, Bankex), the bid-ask spread is typically 1–5 rupees for near-ATM strikes and widens for OTM strikes. Set limit prices as follows:
- For a buy leg: set the limit price at or slightly above the current Ask price to improve the probability of a fill while controlling slippage.
- For a sell leg: set the limit price at or slightly below the current Bid price for the same reason.
Avoid market orders for options, particularly for multi-leg strategies. Market orders on options frequently execute significantly away from the last traded price because the order book is thin outside the best bid and ask.
For stock options, bid-ask spreads can be 5–20 rupees or more. Use the mid-price (average of bid and ask) as the starting limit price, then adjust based on urgency.
For futures legs (for example, in a covered futures strategy or a calendar spread): futures bid-ask spreads are typically 1–5 points for index futures; use the mid-price as the limit.
Review the margin estimate
After all legs are added, Kite displays an estimated total margin for the basket. This is a real-time estimate that factors in SPAN spread benefits for opposing positions on the same underlying. Compare this estimate with your Available Margin in Kite Funds.
For a more precise breakdown, open the Zerodha SPAN calculator in a separate tab, enter all the legs, and confirm the SPAN + ELM total. The SPAN calculator may differ slightly from the basket-order margin estimate if SPAN parameter files were updated after the last basket-calculation refresh.
If the estimated margin exceeds your available margin, reduce lot size on all legs proportionally, or remove the legs that add the most margin (typically the short legs without wing hedges), before proceeding.
Submit the basket
Click Submit All (or Place All Orders in the mobile app). Kite sends all legs as individual limit orders to the NSE exchange engine simultaneously. The basket panel closes and all orders appear in the Order Book (press O to open).
Monitor the Order Book in real time. Each leg shows one of the following statuses:
- Open: order is live in the exchange order book, pending fill.
- Complete: order has been fully filled.
- Rejected: order was rejected (reason shown in the order detail).
- Partially filled: order was partially filled; the remainder is still open.
Wait until all legs reach Complete status before assuming the strategy is fully on.
Handle partial fills
If any leg shows Rejected or remains Open (unfilled) while other legs are Complete, you have a partial strategy:
- Assess the risk: determine whether the filled legs create an unintended exposure. For example, if the short CE of a bull call spread filled but the long CE did not, you are holding a naked short call.
- Cancel any pending orders: click the pending order in the Order Book and click Cancel to remove it from the exchange.
- Decision: either (a) close the filled legs immediately to return to flat, or (b) attempt to re-enter all missing legs at updated prices via a new basket or direct order, depending on market conditions and your judgement.
Do not leave a naked short option position open while trying to manage a partial fill; the risk is asymmetric.
Using baskets for exit
Basket orders can also be used to exit a multi-leg strategy. Build a new basket with the opposing orders for each leg of the open position, set limit prices, and submit. This is the recommended approach for clean simultaneous exit. For a full guide on exit techniques see How to exit a multi-leg F&O position on Zerodha.
Saving and reusing baskets
Kite allows you to save a basket configuration for reuse. After building the basket, click Save. Saved baskets appear in the Basket Orders panel under “Saved Baskets”. This is useful for strategies you trade repeatedly (for example, a standard weekly short straddle on Nifty) as it avoids rebuilding the leg configuration each time. Remember to update prices each time you load the saved basket, as the price fields are not automatically updated.
What can go wrong
- Price moved between basket preparation and submission. For volatile markets, the LTP shown while building the basket can be 5–10 points away from the market price by the time you click Submit. Set limit prices with a small buffer or be prepared to adjust unfilled legs manually.
- Quantity error (lots vs shares). Kite’s basket order entry accepts quantity in shares. If you intend 1 lot of Nifty (75 shares), enter 75, not 1. Entering 1 will create an order for 1 share, which is below the minimum lot size and will be rejected.
- Wrong product type (MIS vs NRML). A basket submitted with MIS legs will be auto-squared-off at 3:25 PM if not closed. If you intend an overnight position, ensure all legs are NRML before submitting.
- Insufficient margin after partial fill. If some legs of a short-premium strategy fill but the long-wing hedge legs do not, the margin requirement increases significantly (naked short vs spread). This can cause a margin shortfall. Monitor funds in real time after a partial fill.
- Freeze-quantity exceeded. If a leg’s quantity exceeds the exchange freeze quantity, the order is rejected. For large lot counts, break the basket into multiple smaller baskets. See How to handle freeze quantity on F&O.
Related guides
- How to build an options strategy on Sensibull
- How to exit a multi-leg F&O position on Zerodha
- How to use the options chain on Kite
- How to handle freeze quantity on F&O
- How to calculate margin using the Zerodha SPAN calculator
- Basket order on Kite
- F&O segment on Zerodha
- Kite, Zerodha’s trading platform
References
- Zerodha support article: “What is a basket order and how to use it?”, support.zerodha.com.
- SEBI Circular SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/120 dated October 2024, Rationalisation of weekly index derivatives contracts.
- SEBI Circular SEBI/HO/MRD/MRD-PoD-2/P/CIR/2020/198 dated 1 December 2020, Peak margin reporting.
- NSE F&O lot size and freeze quantity schedule, nseindia.com.
- Sensibull help centre, “Placing orders from Sensibull into Kite”, sensibull.com/help.