Your collateral margin comes from the holdings you've pledged — it isn't cash. When you sell a pledged holding, Rupeezy automatically unpledges the quantity you're selling first, so it stops counting toward your collateral margin, which drops by that value.
Why does this happen?
- Collateral margin is extra trading power backed by pledged securities, not cash. It's calculated from what you currently have pledged.
- Selling a pledged holding requires unpledging it first — Rupeezy does this automatically as part of the sell order (see Can I sell pledged securities instantly without placing an unpledge request?). Once a holding is unpledged, it no longer backs your collateral margin.
- So your collateral margin drops by the value of what you sold, since that portion is no longer pledged.
What if I only sell part of a pledged holding?
Only the quantity you're selling gets unpledged — the rest of that holding stays pledged and keeps contributing to your collateral margin.
What if the stock is present in both my free and pledged quantities?
If you hold some of a stock free (unpledged) and some pledged, and you sell some of it, the system can default to treating your pledged quantity as sold first — even if you meant to sell from your free holdings. This temporarily reduces your collateral margin. It corrects itself once the sale is reconciled against your free holdings, typically by the next trading day, restoring your pledged quantity and collateral margin — you don't need to re-pledge anything yourself.
Example: You hold 200 shares of a stock — 120 pledged, 80 free — and sell 80 shares, intending to sell only your free quantity.
| Quantity | Before selling | Right after selling 80 shares | After next-day reconciliation |
|---|---|---|---|
| Pledged | 120 | 40 (temporarily reduced) | 120 (restored) |
| Free | 80 | 80 (unchanged) | 0 (the 80 you sold) |
| Collateral margin | Backed by 120 shares | Dips — backed by only 40 | Restored — backed by 120 shares |
Does this affect my cash balance?
No — this is specifically about your collateral (non-cash) margin. It doesn't touch your cash balance; the sale proceeds are settled separately as usual.
Am I charged for this unpledge?
Yes — the standard per-scrip unpledge charge (₹25 + GST) applies, same as if you'd unpledged manually. See How are pledge and unpledge charges calculated? for the full breakdown.