MTF Trading

MTF, delivery or F&O: which fits?

Delivery is the simplest: you pay in full and there’s no running cost. MTF lets the same cash buy more shares but charges daily interest and magnifies losses. F&O gives leverage without owning shares, and most individuals lose money on it.

₹33,333 of your money, held 30 days

Delivery, price up 10% +₹3,333 (+10%)
MTF, price up 10%, after costs +₹12,035 (+36%)
Delivery, price down 10% −₹3,333 (-10%)
MTF, price down 10%, after costs −₹14,631 (-44%)

MTF buys ₹1,33,333 of shares with your ₹33,333; costs are the ₹1,298 all-in for 30 days. Zerodha's published rates, checked 29 Oct 2026. The broker funds 75% here; the real share depends on the stock. Delivery brokerage left out.

How are delivery, MTF and F&O different?

With delivery you pay in full and own the shares. With MTF you own them but borrow part of the price. With F&O you own nothing; you bet on the price with a contract that expires.

DeliveryMTFFutures and options
Do you own shares?YesYes, pledged to the brokerNo, a contract
You pay upfrontThe full pricePart of the priceA margin or a premium
Running costNoneInterest every dayNone daily; the cost sits in the price and fees
How longAs long as you likeUntil you sell, or the broker’s limitUntil the contract expires
DividendsYesYes, the shares are yoursNo

Sources: NSE FAQ on Margin Trading Facility, updated 12 Mar 2025

When does MTF make more sense than paying in full?

When you expect a move soon, the gain should beat the interest, and you can add money if the price dips.

MTF multiplies the move, up or down, and charges interest for every day you hold. Over a short holding with a clear view, the larger position can pay for the interest. Over months, or when the price drifts sideways, the interest eats the gain. Paying in full has no running cost and no margin calls.

Sources: our broker comparison

How many people lose money on F&O?

Most individual F&O traders lose money: SEBI found 87.7% did in FY26, and the average individual trader lost ₹1.17 lakh.

F&O contracts expire, so time works against you, and options can go to zero. With MTF you hold real shares that don’t expire, though leverage still magnifies losses and interest keeps running. SEBI’s figures are for F&O only; there is no similar official study for MTF.

Sources: SEBI study of individual F&O traders, FY25–FY26, Aug 2026