Buy Order

Terminology

• Available Funds :

  Funds available in user's demat account

• Required Funds :

  For Market Orders : Funds required to buy securities at current market prices
  For AMO : Funds required to buy securities at closing prices + Buffer Amount

• Recommended Funds (Only for Market Orders) :

  Required Funds + Buffer Amount

• Buffer Amount :

  Due to change in prices while placing the order, the required funds might go above the available funds and the order might fail in that scenario. To prevent that a buffer amount is added to the required funds.

1. For Market Orders:

a) For Brokers which allow to check available funds:

These brokers are:

• Angel Broking
• Edelweiss
• 5paisa
• Groww
• IIFL
• Kite
• Kotak
• Motilal
• Tradelab
• Trustline
• Upstox

If Required Funds < Available Funds < Recommended Funds, then user is shown a popup to either Add Funds or Proceed Anyway similar to what would be shown if Required Funds > Available Funds.

If Min Buffer is defined then,
Buffer Amount = Max( Buy Amount * Buffer Percentage / 100, Min Buffer )

If Max Buffer is defined then,
Buffer Amount = Min( Buy Amount * Buffer Percentage / 100 , Max Buffer )

If neither Min nor Max Buffer is defined then
Buffer Amount = Buy Amount * Buffer Percentage / 100

Recommended Funds = Buy Amount + Buffer Amount

For example: If a stock costs 3100, then
Buffer Amount = Max( 3100*5/100 , 150 ) = Max( 155, 150 ) = 155
Recommended Funds = 3100 + 155 = 3255

b) For brokers which don't allow to fetch available funds:

These brokers are:

• Axis
• HDFC

These brokers tell if the funds available in user's demat account are sufficient to place the order or not instead of giving the actual funds amount.
In this case if the funds are not sufficient the user is shown a popup Add Funds or Proceed Anyway.

Buffer Amount = (Buy Amount * Buffer Percentage / 100)
Recommended Funds = Buy Amount + Buffer Amount + Min Brokerage

For example: If a stock costs 3100, then for Axis
Buffer Amount = (3100*3/100) = 93
Recommended Funds = 3100 + 93 + 5 = 3198

2. For After Market Orders (AMO) :

The buffer percentages for AMO are different depending on broker:

Buffer Amount = (Buy Amount * Buffer Percentage / 100)
Required Funds = Buy Amount + Buffer Amount + Min Brokerage

Sell Order

Market Order:

For Axis and HDFC user should have the minimum brokerage amount in the demat account. For all other brokers funds need not be available.

After Market Order (AMO) :

For Axis and HDFC a buffer amount and minimum brokerage amount should be present in the demat account for AMO sell orders. For other brokers funds need not be available.

Buffer Amount = (Sell Amount * Buffer Percentage / 100)
Required Funds = Buffer Amount + Min Brokerage