I had sufficient margin in my account when I took the position, so why was I still charged a penalty?

A margin penalty can be applied in the following situations:

Change in margin requirements from the exchange

Change in requirements based on your trading activity (e.g., exiting one of multiple hedge positions)

For long options positions, especially when they are in-the-money (ITM), the margin requirement increases as the expiry date approaches. This is because the exchange adjusts the margin to reflect the higher risk associated with positions nearing expiry.

Note: If you incur a margin penalty, the due date for reporting the margin is T+5 days. We will update penalty entry on your ledger once we receive an update from the exchange, which typically happens on T+6 days. During this time, there may be a provisional block in your account.