5paisa Auto Square Off Charges

The term “auto square off” is a process of closing or exiting intraday trades by the broker before the market ends. 5paisa auto square off charges are applicable on such trades and do not vary on the grounds of trading segments such as equity, commodity, as well as on currency.

Let’s begin with the understanding of the concept! 

5paisa Square Off

Square off is a general term used in Intraday trading in which a trader buys or sells orders in the first period of the day and later reverses the order transaction to earn profits. 

Confused? 

Let’s understand with a quick example.

An intraday trader named Mr. Dev Anand has a trading account with 5paisa. He buys 100 shares of an XYZ company costing ₹ 92 per share at 11:20 a.m. Later at 2:00 p.m., the price of the underlying asset went high to ₹ 102 per share, hence he executed the order instantly and earned a profit of ₹1000 (₹10*100 shares) from this deal.

Thus, Mr. Dev Anand executed his buy and sell order on the same day. This means he has smoothly squared off his trade.

On the other hand, when a trader fails to square off his position before the end of the day or before 5paisa intraday square off time, the open position under MIS, Cover Order, and 5paisa Bracket Order gets executed automatically by the broker which is known as “Auto Square Off”. 

So, here if Mr. Dev Anand, having no idea of the intraday square off time, thus ends up paying the additional charges to the broker. 

To prevent yourself from paying this additional fee, here are the square off timings for each trading segment of 5paisa:

5paisa Square Off Charges

As already discussed, square off trades are made frequently in a day and when an order is completely executed, no charge is applied. 

However, if the open positions of MIS orders are not closed before the square off time limit, then the broker will auto square off a position. To execute the trade on the trader’s behalf, the broker charged certain fees.  These are the 5paisa Auto Square Off Charges.

Here 5paisa charges a flat fee of ₹20 per order. 

Let’s calculate the same by considering an example. 

Suppose Mr. Dev Anand buys 100 shares of XYZ firm and 100 shares of ABC company in the morning at 10 AM. He forgets to square off his positions on time and therefore brokers auto-squared off his positions charging ₹20 per order (here, ₹40 for both the trade).

Apart from this he was charged with the intraday brokerage on buy and sell order, ₹20 per order. 

Thus, apart from the 5paisa intraday brokerage charges and other taxes, he has to pay the additional sum of ₹40 to the broker as the auto square off charges thus impacting his overall Profit or Loss percentage.  

Closing Thoughts

Auto square off feature is quite new and unique in the market. Through this feature, 5paisa can automatically execute the open position that has been placed under MIS, CO, or BO order type and is not executed when the provided time is up. 

So when trading with 5paisa, it is good to consider the auto-square off time to prevent yourself from paying the 5paisa Auto Square Off Charges.

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