Liquid fund margin (Liquidcase) on Zerodha

Mon, 11 May 2026 00:00:00 +0000

Overview

Liquidcase is Zerodha’s integrated facility that allows traders to invest funds sitting idle in their trading account into liquid mutual funds through Coin, Zerodha’s direct mutual fund platform, and simultaneously pledge those liquid fund units as margin collateral for futures and options (F&O) trading on Kite. The facility addresses a structural inefficiency in retail F&O trading: cash held as margin in a trading account typically earns no return, while the same amount invested in a liquid mutual fund earns money market returns while remaining available as collateral.

Mutual fund pledging on Zerodha

Mon, 11 May 2026 00:00:00 +0000

Overview

Zerodha allows clients to pledge mutual fund units held in demat form – typically units purchased through Coin, Zerodha’s direct mutual fund platform – as collateral margin for futures and options (F&O) trading on Kite. This facility extends the margin pledge framework to mutual fund units, enabling clients to earn returns on their invested corpus while simultaneously using that corpus as collateral against F&O margin requirements.

Mutual fund pledging is distinct from the Liquidcase facility (which specifically targets liquid fund units as near-cash collateral) in that it covers a broader range of fund categories including equity-oriented funds, debt funds, and balanced funds. The haircuts and collateral margin treatment vary significantly by fund category, and equity mutual funds in particular are treated as non-cash collateral rather than cash-equivalent collateral.

Mutual Fund Pledge on WebNotes

Liquid fund margin (Liquidcase) on Zerodha

Overview

Mutual fund pledging on Zerodha

Overview