What is SPAN Margin in Options Trading? | ELM & VaR Explained

Описание: In this video, we explain SPAN Margin, Extreme Loss Margin (ELM), and how margin works in the F&O market. Using examples from the National Stock Exchange of India guidelines and Securities and Exchange Board of India recommendations, we discuss how Value at Risk (VaR), volatility, and option positions affect margin requirements.

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We also discuss why margin requirements increase when volatility rises and why certain strategies like calendar spreads require lower margins compared to naked option selling.

If you are trading in derivatives or planning to start options trading, understanding margin is essential to manage risk and avoid unexpected losses.

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⚠️ Disclaimer: Investments in securities markets are subject to market risks. Read all related documents carefully before investing.
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⏱️ Timestamps
00:00 Introduction to Margin in Options Trading
00:20 Checking Margin Details on NSE Website
00:40 What is SPAN Margin?
01:05 Role of Value at Risk (VaR) in Margin Calculation
01:25 Extreme Loss Margin (ELM) Explained
01:45 Margin Requirements for Index vs Stocks
02:05 Risk in Short Options Contracts
02:20 Why Calendar Spreads Have Lower Margin
02:35 Understanding Deep Out of the Money Options
02:50 Final Thoughts & Risk Disclaimer
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