https://v2.webnotes.in/tags/cash-component/Recent content in Cash Component on WebNotesHugoen-INWed, 20 May 2026 00:00:00 +0000https://v2.webnotes.in/cash-component-vs-collateral-component/Wed, 20 May 2026 00:00:00 +0000https://v2.webnotes.in/cash-component-vs-collateral-component/<p>For F&amp;O margin on Zerodha, the SEBI framework requires that the user maintain a specific split between <strong>cash component</strong> and <strong>collateral component</strong>. The 50:50 rule mandates at least 50% in cash; the rest can be from pledged collateral.</p> <h2 id="what-counts-as-each">What counts as each</h2> <h3 id="cash-component-at-least-50">Cash component (at least 50%)</h3> <ul> <li><strong>Free cash</strong> in trading account.</li> <li><strong>Liquid fund collateral</strong> (LIQUIDBEES, similar; haircut-adjusted).</li> <li><strong>Option premium credit</strong> on short positions.</li> <li><strong>T-bill / specific liquid debt collateral.</strong></li> </ul> <h3 id="collateral-component-up-to-50">Collateral component (up to 50%)</h3> <ul> <li><strong>Pledged equity</strong> (haircut-adjusted).</li> <li><strong>Pledged ETF</strong> (non-liquid; haircut-adjusted).</li> <li><strong>Pledged corporate bonds.</strong></li> </ul> <p>The total = cash + collateral.</p>