Zerodha Nudge Sale-of-holdings

Nudge: 100% sale-of-holdings funds

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Kite shows a nudge warning when a planned order would consume 100% of your “sale of holdings” funds, alerting you to the capital-deployment risk.

What it means

Sale-of-holdings funds are the proceeds from selling existing CNC holdings (subject to T+1 settlement ). Kite’s nudge appears when:

  • You’ve sold some CNC holdings today.
  • You’re about to place an order using those (not-yet-settled) proceeds.
  • The order would consume 100% of those proceeds.

Why the warning

If 100% is deployed:

  • No buffer for fees, slippage, or unexpected margin requirement.
  • If the sell trade fails settlement (very rare), the buy may face shortfall.
  • Adverse MTM can quickly create shortfall.

The nudge is a soft warning, not a hard block. You can proceed.

How to handle

Options:

  1. Proceed: Accept the 100% deployment risk.
  2. Reduce position size: Leave 10-20% buffer.
  3. Wait for settlement: T+1 evening for funds to fully settle.
  4. Pay in additional funds: Provide cash buffer via UPI.

For most retail trades, option 2 (reduce slightly for buffer) is prudent.

When the nudge is over-cautious

The nudge fires even for safe scenarios:

  • Same-day CNC sell + new CNC buy (rolling holdings).
  • BTST round-trip.
  • Selling underlying + buying ETF (rebalancing).

For these, the user often understands the risk and proceeds.

See also

External references

References

  1. Zerodha Support, Order placement nudges, support.zerodha.com.
  2. SEBI, T+1 settlement framework, sebi.gov.in.

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