If you’re trading equities or options, you may already be using leverage, with most brokers offering a margin trading facility (MTF). But have you calculated which broker gives you more buying power for that cost?
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A margin trading facility allows investors to take delivery of eligible stocks, and they need to pay only a part of the trade value. The broker funds the remaining amount.
But the actual cost of your trade depends on the MTF limit, interest rate, and brokerage charges. In this blog, we have compared these key figures between Dhan and Angel One, two of the most popular brokerage platforms traders use.
MTF comparison – Dhan vs Angel One
The MTF limit is only one part of the comparison. Your overall experience also depends on the cost of borrowing and transaction-related charges. The following comparison will help you understand the exact charges you need to pay for the margin trading facility on these two platforms.
| Parameter | Dhan | Angel One |
| Maximum MTF limit | ₹5 Crore per client/ up to 4X of buying power | Up to 4X buying power |
| DDPI requirement | ₹5 Crore requires DDPI; otherwise ₹1 Crore | Not specified |
| MTF interest | 12.49%-15.49% p.a. based on funded amount | 14.99% p.a. |
| Daily interest | 0.0342%-0.0425% | 0.041% |
| MTF brokerage | ₹20 or 0.03%, whichever is lower | 0.1% or ₹20, whichever is lower, minimum ₹2 |
| Pledge charge | ₹15 + GST per ISIN | ₹20 + GST per request per ISIN |
| Unpledge charge | ₹15 + GST per ISIN | ₹20 + GST per request per ISIN |
| Single-stock exposure | ₹2 Crore/day in F&O; ₹1 Crore/day in non-F&O | Not specified |
MTF limit and leverage
The maximum MTF capability provided by Dhan is ₹5 crore per client or up to 4X their buying power. DDPI activation is necessary to gain access to this full limit. The MTF limit without DDPI activation remains capped at ₹1 Crore.
Dhan also allows exposure of up to ₹2 crore per day per stock in F&O counters and ₹1 Crore per day per stock in non-F&O counters.
Traders using Angel One get up to 4X buying power on delivery trades, based on eligible equity categories.
MTF interest rates
While seeking margin trading facilities, traders often want to know about the interest structure. Dhan follows four slabs depending on the amount it funds.
| Funded amount | MTF interest rate |
|---|---|
| Up to ₹5,00,000 | 12.49% p.a. |
| ₹5,00,000.01 to ₹10,00,000 | 13.49% p.a. |
| ₹10,00,000.01 to ₹25,00,000 | 14.49% p.a. |
| ₹25,00,000.01 to ₹5,00,00,000 | 15.49% p.a. |
Interest is calculated daily and posted to the ledger weekly.
Angel One charges a flat annual interest of 14.99% on the borrowed value. The interest applies from the day you place the trade till the day before the position is closed.
Brokerage and pledge charges
Dhan charges ₹20 or 0.03%, whichever is lower, for MTF orders. Angel One charges 0.1% or ₹20, whichever is lower, with ₹2 as the minimum brokerage.
Dhan charges ₹15 + GST per ISIN for both pledging and unpledging. Angel One, on the other hand, charges ₹20 + GST per request per ISIN.
Which broker offers a higher MTF limit?
If you’re specifically looking for the broker with highest MTF limit, it’s important to compare the limits provided by Dhan and Angel One.
Dhan has clearly stated that its maximum MTF capability is ₹5 Crore per client, with 4X the buying power for investors. Angel One also provides 4X MTF, but doesn’t mention the upper cap.
Considering the lower cost structure and transparency around limits, Dhan is considered the better option for many investors.
Conclusion
Dhan continues to be a top trading & investing app in India, known for its lower cost structure and transparency regarding MTF limits. Angel One, on the other hand, has a sizable user base. When it comes to high-value margin trades for equities or option trading, having a clear idea about the cost structure helps you make informed decisions.
Dhan ticks both these boxes, charging just ₹15 + GST per ISIN for both pledging and Unpledging and a slabbed MTF interest rate. Now, you are well-informed to choose your trading app and can calculate the associated charges for the margin trading facility with clarity.
