How to avoid short delivery?
To avoid short delivery, one needs to be cautious and have a clear understanding of one's holdings and the market environment. Here's how you can steer clear of such situations:
Verify Your Holdings: Before selling any shares, ensure that the exact quantity is available in your demat account. It's a common error to sell without having sufficient holdings, leading to short delivery.
Square off Intraday Trades: If you've undertaken intraday trading, always remember to square off your positions before the market winds up. Intraday trades, if not squared off, can cause short deliveries.
Check Stock Restrictions: Always monitor the stock's status. If it's under a ban period or has reached its circuit limits, selling might lead to short delivery.
Stay Updated: Regularly update yourself with the market news, notifications from exchanges, and messages from your broker, like FYERS, to be aware of any developments that can influence your trades.
By being vigilant and staying informed, you can easily prevent unwanted short deliveries.
Related Articles
What does short delivery mean and how does it impact me?
Short delivery is a situation in the stock market when a seller doesn't deliver the promised shares to the buyer within the stipulated time. This typically occurs when a seller mistakenly sells shares without possessing them or if a particular stock ...
What is short selling?
Short selling is a trading strategy where you borrow and sell a security you don't own, hoping to repurchase it later at a lower price, profiting from the price difference. For instance, if you borrow 100 shares of a company at ₹550 each, you'd ...
What happens if my intraday equity short position isn't closed by end of day?
When you engage in intraday equity trading, it's crucial to understand the implications if short positions aren't squared off by the day's close. Understanding Short Delivery: In instances where your intraday equity short position remains unsquared ...
What penalties does a seller face for short delivery of shares?
If a seller is unable to deliver the promised shares, they will be charged the difference between the auction's settlement price and their original selling price. Furthermore, an auction penalty of 0.05% per day is levied for each day the shares ...
How can I rollover a contract to avoid physical settlement?
Rollover refers to the process of transferring your position from the near-month expiry contract to the next month's expiry contract, typically on the expiry day. By doing this, you're essentially closing your current position and simultaneously ...