What is a Haircut in pledging and how does it affect margin at FYERS?

What Is a Haircut in Pledging and How Does It Affect Margin at FYERS?

When you pledge securities at FYERS for collateral margin, the full market value of your holdings is not considered. A percentage reduction called a haircut is applied so that only a portion of the value counts toward the margin. This acts as a risk buffer against sudden price drops in pledged securities.

What is a haircut?

A haircut is the percentage by which the market value of pledged securities is discounted for margin purposes. More volatile securities attract higher haircuts, while stable or cash-equivalent securities have lower ones.

You can view the list of all approved pledgeable securities and their corresponding haircut percentages on the FYERS haircut list.

Example

If you pledge securities worth ₹20,00,000 and the haircut is 10%, the collateral margin available to you becomes:

₹20,00,000 – 10% = ₹18,00,000

Haircuts vary by security based on volatility and risk, so always check the current percentage in the FYERS haircut list before pledging.

What if...

ScenarioSolution
My pledged value looks lower than the market valueThis difference is the haircut; check the exact percentage in the FYERS haircut list to see how much of the value is counted for margin.
I pledged volatile stocks and received less margin than expectedVolatile stocks have higher haircuts, so consider pledging stable or cash-equivalent securities to receive a higher effective margin.
I pledged LiquidBees, but still see a haircutLiquid ETFs also have haircuts, although typically lower than equity haircuts.
Can haircut percentages change?Yes, exchanges may revise haircuts based on volatility or liquidity, so check the list periodically.

Last updated: 05 Dec 2025

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