What Are MTF Stocks and How Do They Work?

What Are MTF Stocks and How Do They Work?

Blog Article

Margin Trading Facility (MTF) allows investors to buy stocks by paying only a fraction of the total trade value, while the broker funds the rest. The stocks that are eligible for such trading are called mtf stocks.

???? Key Features:

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  Leverage: Investors can trade more than their available capital.

  
  


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  Collateral: The purchased MTF stocks are held as collateral.

  
  


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  Short-term Strategy: Best suited for short- to medium-term investors.

  
  

???? Example:

Suppose you want to buy ₹1,00,000 worth of shares. With 4x leverage under MTF, you may only need to bring in ₹25,000, and the broker funds the rest.

???? Risk Note:

While MTF enhances your buying power, losses can also be amplified. If the stock price falls significantly, you may face a margin call to add funds or square off your position.

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