CNC Order Type
CNC, or Cash and Carry, is the product type you choose when you want to buy shares and actually hold them. Unlike intraday products, a CNC order is not auto-closed. The shares move to your demat account on T+1 and stay there until you decide to sell. CNC is the default for long-term investors using Indian brokers.
Key takeaways:
- CNC is meant for delivery-based equity trades — you pay the full price and receive the shares.
- There is no leverage; you need 100% of the trade value in your trading account.
- Shares are credited to your demat account on T+1 (one working day after the trade).
- CNC positions have no auto square-off — you decide when to sell.
- STT is charged on both buy and sell sides for delivery trades, unlike intraday.
What does CNC actually mean?
The full form of CNC — Cash and Carry — captures the idea perfectly. You bring the full cash and you carry the shares home. There is no margin funding, no overnight risk to the broker, and no obligation to close the trade by the end of the day. Once the order executes, the shares belong to you.
In an Indian broker’s order window, CNC sits alongside MIS (intraday) and NRML (F&O carry-forward). You pick CNC when your intent is to invest rather than trade.
How a CNC trade settles
- Order placed: You buy 100 shares of Infosys at ₹1,500. The ₹1,50,000 is blocked in your trading account.
- T-day: Trade is executed on the exchange. You see the position in your holdings but as an unsettled trade.
- T+1: Settlement happens. Shares are credited to your demat account; funds are debited.
- Hold or sell: Once shares are in demat, you can hold indefinitely. Selling them later is also a CNC trade and reduces your holdings.
Charges on a CNC trade
The real cost of a delivery trade is usually low if you trade with a discount broker, but the statutory charges add up. Typical breakup on a ₹1,00,000 CNC buy:
| Charge | Approximate rate |
|---|---|
| Brokerage | Flat ₹0–20 per order (Lemonn charges ₹0 on equity delivery) |
| STT | 0.10% of turnover (buy & sell) |
| Exchange transaction charge | ~0.00322% NSE / 0.00375% BSE |
| GST | 18% on brokerage + exchange charges |
| SEBI turnover fee | ₹10 per crore |
| Stamp duty | 0.015% on buy side only |
When to choose CNC
- You want to build a long-term portfolio across blue-chips and emerging mid-caps.
- You are running a SIP-like accumulation in individual stocks.
- You plan to hold for more than 12 months to qualify for long-term capital gains tax treatment.
- You are buying ETFs or REITs for income.
CNC vs MIS — picking the right product
| CNC | MIS | |
|---|---|---|
| Holding period | Any (long-term ready) | Same day only |
| Margin | 100% upfront | Reduced (leverage given) |
| Auto square-off | No | Yes (~3:15 p.m.) |
| STT | 0.10% buy + sell | 0.025% sell only |
| Best for | Investors | Active intraday traders |
Things investors often miss
Short selling is not allowed in CNC because you must own the shares before selling. A CNC sell of a stock you do not hold will be rejected. If your shares are still in T+1 settlement, you can usually sell them the same day under most brokers, but this counts as a BTST trade and has its own risks.
Frequently asked questions
Can I sell CNC shares the same day I buy them?
Yes, but it becomes a BTST (buy today, sell tomorrow) style trade and not pure intraday. The shares are technically not in your demat yet, so brokers warn about short-delivery auction risk.
Is there any leverage on CNC?
No. SEBI rules require full upfront payment for delivery trades since the September 2021 framework.
Will my CNC position get auto-closed?
No. CNC has no end-of-day square-off. You hold the shares until you decide to sell.
Do I need a demat account for CNC?
Yes. CNC shares are settled into your demat account. A trading account alone is not enough.
