---
title: 'Stock Pledging: How to Borrow Money from Your Broker'
source: 'https://youtube.com/watch?v=QIzOY4w16uk'
video_id: 'QIzOY4w16uk'
date: 2026-07-23
duration_sec: 1434
channel: 'DAY TRADER తెలుగు 2.0'
---

# Stock Pledging: How to Borrow Money from Your Broker

> Source: [Stock Pledging: How to Borrow Money from Your Broker](https://youtube.com/watch?v=QIzOY4w16uk)

## Summary

This video explains how to leverage stock pledging to borrow money from brokers for trading, potentially turning a small investment into significant profits. It covers the mechanics, risks, and step-by-step process for pledging stocks on platforms like Zerodha, Upstox, and Angel Broking.

### Key Points

- **Pledging Overview** [00:00] — The presenter shows how 2.7 lakh rupees in pledged stocks can grow to 48 lakhs through strategic trading using borrowed funds.
- **Cost of Pledging** [00:28] — Brokers charge a one-time fee of 30 rupees plus GST for pledging, but no interest on the borrowed money thereafter.
- **What is Pledging?** [02:19] — Pledging involves keeping stocks, mutual funds, or bonds in your demat account as collateral to borrow money from the broker.
- **Haircut on Pledged Stocks** [03:11] — Brokers apply a haircut (margin) on pledged stocks; good stocks may get 80-90% value, while risky stocks may get only 50-60%.
- **Using Pledged Money** [04:48] — Borrowed money can be used for intraday trading, selling options, or buying stocks, but not for buying delivery stocks or carrying futures/options overnight without additional cash.
- **Cash Component Requirement** [06:01] — For positional trading, 50% of the margin must be in cash or low-risk assets like liquid funds; only 50% can come from pledged stocks.
- **Covered Call Strategy** [07:13] — By pledging ETFs and selling far-out-of-the-money calls, you can earn extra income while holding the underlying asset.
- **Risks of Pledging** [09:32] — If the market falls, the broker may demand additional collateral or sell pledged stocks. Corporate actions like dividends are unaffected.
- **Interest on Shortfall** [13:19] — If you fail to maintain margin, the broker charges 0.035% per day on the shortfall.
- **Pledging Process on Zerodha** [14:17] — Go to Console > Portfolio > Holdings, select stocks, and submit pledge request. Then authenticate via CDSL portal using OTP.
- **Pledging on Upstox and Angel Broking** [22:03] — Similar process: select stocks in the app, submit request, and authenticate via the CDSL link.

### Conclusion

Pledging can amplify returns but carries significant risk, especially in volatile markets. Only traders with a clear strategy and risk management should use this tool.

## Transcript

If you see on the screen, I have almost 2,70,000 I pledge the stocks from my holdings and I can grow that 2,70,000 to 48 lakhs
Not just Zerodhana, but also Upstoke and other Broking platforms In the stock market, we can take a loan or money from the broker
Usually, whether we have gold, land or house We collect some starting charges But if you borrow all the stocks, mutual funds, sovereign gold bonds, liquid funds, liquid Bs
from the broker, starting 30 rupees plus GST But later, no one charges us a single rupee for the money they give
We use it personally or even in the previous times, whenever we showed you the profit you can see something in the holdings
In fact, you can see sovereign gold bonds, nifty ETFs, blue chip stocks Why do we invest so much money in investments? Not only us, whoever you see
Why do they invest in such a way? Friends, there is a video in our channel about this pledging topic I explained each and everything to you in a beginner level
I will talk about what you should know How to earn extra income because of pledging If you don't know those, you will lose your investment
So, I will cover these points and end today's video If you think this content that we are sharing is valuable Like the video and try to encourage the efforts we are making
Pledging is keeping the money You hold the money in your D-mat account Or other than D-mat account, if you hold bonds
Or liquid funds or active mutual funds So, if you hold any of these stocks for a long time You hold those bonds and take money from the broker
Not all brokers do this for free 30 rupees plus GST If you pledge and keep the money and separate the stocks
It's only for pledging Provide this without any charges There are some elements
You will pay 20% more to the broker Now, let's talk about the important things Let's say, in a particular company
If you take those 1000 rupees and pledge it to the broker If you have good stocks If you have bad stocks
They will give you the remaining money They will give you 900 rupees If it falls to 10%
If you have very old style stocks They will release 50% or 60% How much haircut is there in which stocks?
If you want to see it before pledging How much haircut is there in which stocks? They will keep it safely with the broker
You will see it here If you pledge a stock of 100 rupees If it is a simple stock
And give you 87.5 rupees It will be in the excel sheet We don't get the entire money
For example, I have put a target They gave me 86 rupees for 100 With the money that comes, can I buy another stock?
I can't buy stocks that are in the delivery I can sell options in intraday And I can buy and sell stocks
But, in positional, I can sell options This is another important element that you should remember You can't carry more than one day
And another important element You can't buy futures or sell options If you want to carry more than one day in a strategy
Then you should pledge 50% of your stocks or mutual funds Another 50% should be used for the money you have You want to sell options for 50% of the money
And you want to carry it in positional In that case, in the money that you are asking for 100,000 rupees Even if you have 10 lakhs in your account
You can use only 50,000 rupees from the money you have Another 50,000 or 50,000 should be used for the money you have Cash components are elements that are very low risk
I have given you the details of the cash components Like liquid Bs, liquid ETFs, government securities and debt
Most of the ETFs and mutual funds are in the cash component category 50% of the stocks or mutual funds or whatever the risk is
Another 50% should be used for the money you have Or for the liquid funds or debt mutual funds And the broker will not charge any kind of interest on this
I have just pledged the stocks I have No, mostly if you pledge today I will explain it to you at the end of the video
Now let's talk about the positives Let's say I am holding Nifty ETF When will that Nifty ETF give me a profit?
If the market falls, I will not get any profit from that ETF In such a situation, if I keep this ETF as a token
Let's say 10 or 15% away Let's talk about each case If the Nifty keeps growing, my ETF will grow and so will the call
Let's assume it is possible My ETF will give me that 15% profit Till that time, I will get all the profit
The more I go far and sell the call I cannot take that profit I will not get any profit
If I am holding a big quantity of stock or index With the money that comes, with half the profit By selling the call to that particular stock or index
Till the time I sell it, I will get the profit Second, if the market or stock is there With that, I will buy the ETF that I sold to that particular stock or index
Then the loss that comes in that index It will manage it till some extent With that profit, I can buy the stock or index that I sold
So, this is the least risk case Let's talk about the negatives Or even liquid funds or debt-related securities
By selling calls that are far away This is called a covered call I will tell you simply
If you watch this once, you will understand the entire strategy Corporate actions like dividend, stock split, buyback, bonus, etc. Whatever corporate actions are worth to the stocks in your D-MAT account
They are all worth We are not taking a bribe Even if we have a very small return by looking at the safe options
Particularly, they will be doing covered calls strategy One thing to keep in mind is If you lose their value
When it was at 19,500 If 10% is lost, they kept 1 lakh aside and gave you 9 lakhs to trade
Or doing covered calls If the value of the pledged is increasing The broker gave you 9 lakhs
When it was at 19,500 The money that the broker gave you is a risk for the broker So, the value, the stocks or indexes that you pledged
The broker will tell you to pledge it additionally And the percentage that we gave you They will ask you to maintain the margin of safety of 90% to 10%
You are not able to pledge it additionally And balance the loss that is coming
They will sell it in the market So, whoever enters without any logic They are going to risk
If they are impacting Market will be falling If the market falls, the call in the covered call will be zero
They are doing neutral option strategy Because they have not only the money they have Market gap is down opening
Broker will ask for more You have to balance it Broker will sell the money that you have in the market
Means, if you invest and put it in the index or stock If you trade more options than you do with that money So, only those who are hedging with a risk reward
And trading with clarity will get the benefit of pledging I will get extra income by pledging and putting the money Definitely, it is a double edged sword
So, traders should understand the risk in this pledging Before thinking that I can pledge and earn money by just leaving the stocks Another important element
If you are not able to transfer the money to the account when you have to pay And you have to maintain the cash component 50% And 50% of the pledged money
Or if you are not able to add the money to the account Overall, if you are using the broker's money in the entire process How much will it go?
0.035% per day They say they will blame you The broker will intimidate us
They are adding funds and reducing positions This pledging will work better Now, let's know how to do the pledging
But I will explain the process clearly First, Zerodha It is near to 2.7 lakhs
Regarding this, we should keep the stocks, ETFs, mutual funds, etc. as a target Here, you will see two stocks for 25-25 lakhs
Nifty 50 Index The one on top is also ETF So, why 25 lakhs in this and 25 lakhs in that?
As I told you in the beginning A strategy is to buy 50% non-cash components Or active mutual funds
Government securities, liquid funds, liquid bees, sovereign gold bonds And the one below this should be half 25 lakhs in ICICI liquid fund ETF
Half of this and half of that If you feel comfortable in this I am not saying that you should invest in Nifty bees or ICICI liquid funds
Cash component and non-cash component We will not have any issue when we trade with the money that comes from pledging But if we buy all the Nifty bees and put it in the cash account
You should be able to manage the calculations time to time So, I will pledge both 25 lakhs and 25 lakhs in this So, you can see how the previous 2 lakhs and 70 thousand will grow
Next, portfolio, holdings You will see which stocks are in your D-mat account Go to the console and click on it
Look here And if you pledge, you will see a huge haircut You can also know how much haircut you will get when you pledge
You will keep 8 rupees with you for safety For safety They change all the time
If you do it a few times, the stock in your D-mat It may be a micro cap or penny stock Mostly micro caps, small caps, penny caps
So, you may take our situation Even if they see a good opportunity in small caps or micro caps Capital will get blocked
But that breakout should be there until the entire cycle play If we think the best strategy for us is this
Will invest in ETFs, liquid funds, liquid bids How much haircut will you have?
Click on the terms and conditions If there is 12,000, I have only 1200 quantity What will I get if I pledge 8% of that?
So, how much money we need We can pledge that much money The total value I pledge is 24,35,000
They are saying that they will release money to me at 8% or 22 lakhs Pledge request has successfully submitted Before knowing the next process
I am pledging liquid ETF also So, if I put the total amount of 2500 If I take 10% haircut
And they will release me at 22.5 lakhs So, once we have pledged Because it is not with us
Once the process is completed, it will go to the broker side If we send it to the broker Next, there will be a link for your mobile and email
I will give the link in the description and comment section It can be late sometimes If you go to this link and log in and check
The broker will look at it and release the money Or if you have any doubts, I am giving this link Bookmark it
And authenticate the pledged stocks If we placed a token But what did the Sevi's do?
And place them in their D-mat So, even if we place a pledge request to the broker We have to enter OTP
From the CDSL portal Or you can save this link and come to this page Or if you remember, your D-mat account number
Once you log in, you will see which stocks you have pledged We put Nifty ETFs related to Nippon We will see these two
You thought you don't need to do one more So if you are creating a pledge request by mistake If you want to pledge everything you did correctly
Two of them were ticked Once you accept the OTP What happens next?
If I want, I can withdraw it I can buy options Collateral equity is 23 lakhs
Means, non-cash component is 23 lakhs 45.93 lakhs total collateral money
How much cash is present for it? So if you see money on any account So next time if you see a profile like this
If you look at the bottom So that through their investment There will be money from that
Similarly, through the money they have What are they doing with the triangle strategy? Friends, after you open the Upstox app
It will take you to a webpage You can create a pledge related to your favorite stock And how many stocks you have to pledge
From that, how many stocks you want to pledge They are taking the pledge cost There will be all the details
Again, I told you about a website URL After you save it, you can go directly To show you in that link
That you want to pledge these stocks through OTP In Fires If you scroll down a little bit, it will say pledge
In Angel Broking You will see stock pledging there Mutual funds, ETFs, bonds
You can pledge all these I did a dedicated video on pledging I told you I will give you the excel sheet data
All the important links will be in the description and comments I will come back with another interesting video Jai Hind