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June 14, 2026
The Dispatch

Definition

Peak Margin

Peak margin is SEBI's rule requiring brokers to ensure full margin is available at the highest exposure point during the day, checked via random snapshots.

Under SEBI's peak margin framework, the clearing corporation takes several random snapshots of each client's positions through the trading day and requires the highest of these margin obligations to have been met. This stops brokers from giving excessive intraday leverage and squaring up later.

For Indian traders, peak margin means you must have 100% of SPAN plus exposure margin upfront for the full position size you hold at any moment — even intraday. Falling short triggers a margin shortfall penalty, so position sizing and available funds must be planned before entering trades.

Related terms

  • SPAN MarginSPAN margin is the core risk-based margin for F&O positions, calculated by simulating worst-case price and volatility moves.
  • Exposure MarginExposure margin is an additional buffer collected on top of SPAN margin to cover extreme or unexpected market moves.
  • Peak MarginPeak margin is SEBI's rule requiring brokers to ensure full margin is available at the highest exposure point during the day, checked via random snapshots.
  • Margin Shortfall PenaltyA margin shortfall penalty is a fine levied when a trader fails to maintain the required upfront margin for F&O positions.

Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.