Why some holdings cannot be pledged?

Why some holdings cannot be pledged?

  • Some holdings cannot be pledged for the following reason
    1. Not in approved stock list: - Stocks which are not present in the approved stock list cannot be used for pledging.List of the approved stock list can be seen
    2. Already reached the member -wise limit for that security: - The total quantity of each approved security that can be pledged by any member is limited at the trading member level by the clearing corporation. Holdings cannot be pledged if the overall maximum pledge limit has been reached for that particular security.
    3. Stock’s VaR is 100%: Stocks with a VAR of 100% cannot be pledged. Additionally, if a stock has already been pledged as collateral and its VAR reaches 100%, further shares cannot be pledged.
    4. Securities with Lock – in period and Fractional Shares: - Pledge requests for securities under the lock-in period will be rejected and  fractional quantity of any instrument cannot be pledged as pledge requests can be placed only in multiples of 1.