{"id":12222,"date":"2026-05-22T13:38:56","date_gmt":"2026-05-22T13:38:56","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/glossary\/nrml-order-type\/"},"modified":"2026-05-22T13:38:56","modified_gmt":"2026-05-22T13:38:56","slug":"nrml-order-type","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/nrml-order-type\/","title":{"rendered":"NRML Order Type"},"content":{"rendered":"<p>NRML &#x2014; short for &#x201C;Normal&#x201D; &#x2014; is the product type you pick when you want to carry a futures or options position beyond the same <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/trading\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">trading<\/a> day. It uses the full exchange-mandated margin and does not get squared off automatically, making it the standard choice for swing traders and hedgers in the F&amp;O segment.<\/p>\n<div><strong>Key takeaways:<\/strong>\n<ul>\n<li>NRML is used in the futures &amp; options segment to hold positions overnight, up to the contract expiry.<\/li>\n<li>It requires the full SPAN + <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/exposure-margin\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Exposure margin<\/a> specified by the exchange.<\/li>\n<li>There is no auto square-off; you choose when to exit before contract expiry.<\/li>\n<li>Lower <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/leverage\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">leverage<\/a> than MIS, but no end-of-day risk of forced closure.<\/li>\n<li>Compulsory physical settlement applies for stock <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/derivatives\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">derivatives<\/a> if held into expiry.<\/li>\n<\/ul>\n<\/div>\n<h2 id=\"where-nrml-fits-in-the-order-window\">Where NRML fits in the order window<\/h2>\n<p>When you trade futures or options at any Indian <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/broker\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">broker<\/a>, you will be asked to choose between MIS and NRML. MIS is intraday-only with higher leverage; NRML is carry-forward with full margin. NRML is the default product type for positional traders and hedgers because positions can stay open until the last Thursday of the expiry month.<\/p>\n<h2 id=\"how-margin-is-calculated-under-nrml\">How margin is calculated under NRML<\/h2>\n<p><a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/sebi\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>SEBI<\/a> requires brokers to collect the full upfront margin as calculated by the exchange. This margin has two components:<\/p>\n<ul>\n<li><strong><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/span-margin\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">SPAN margin<\/a>:<\/strong> Based on standard <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/portfolio\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">portfolio<\/a> analysis of risk; covers worst-case scenarios for the position.<\/li>\n<li><strong>Exposure margin:<\/strong> An additional buffer charged by the exchange on top of SPAN.<\/li>\n<\/ul>\n<p>For example, one lot of <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/nifty\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Nifty<\/a> futures might need around &#x20B9;1.1&#x2013;1.3 lakh in total margin under NRML. The same lot under MIS might need only 40&#x2013;50% of that, but with the catch that it must be closed by 3:25 p.m.<\/p>\n<h2 id=\"carrying-positions-overnight\">Carrying positions overnight<\/h2>\n<p>Overnight risk is real. Global cues, results, and macro news can cause gap moves at the next open. NRML lets you take that risk consciously. Mark-to-market (MTM) is applied at the end of each day &mdash; gains are credited and losses d<a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/ebit\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>ebit<\/a>ed to your <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/trading-account\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">trading account<\/a>.<\/p>\n<p>If your account balance falls below the maintenance margin, the broker issues an MTM call and may <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/square-off\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">square off<\/a> the position the next morning if you do not top up funds.<\/p>\n<h2 id=\"physical-settlement-on-expiry\">Physical settlement on expiry<\/h2>\n<p>SEBI moved all stock <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/derivative\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">derivative<\/a>s to compulsory physical settlement in 2019. That means an NRML position in stock futures or in-the-money options held to expiry must be settled by delivering or receiving the underlying <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/shares\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">shares<\/a>. The full notional value comes into play, which can be several times the margin posted.<\/p>\n<p><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/index\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Index<\/a> derivatives (Nifty, Bank Nifty, FinNifty, etc.) are still cash-settled and do not have this issue.<\/p>\n<h2 id=\"nrml-vs-mis-in-f-o\">NRML vs MIS in F&amp;O<\/h2>\n<table>\n<tr>\n<th><\/th>\n<th>NRML<\/th>\n<th>MIS<\/th>\n<\/tr>\n<tr>\n<td>Holding period<\/td>\n<td>Up to expiry<\/td>\n<td>Same day only<\/td>\n<\/tr>\n<tr>\n<td>Margin<\/td>\n<td>Full SPAN + Exposure<\/td>\n<td>Reduced (intraday leverage)<\/td>\n<\/tr>\n<tr>\n<td>Auto square-off<\/td>\n<td>No<\/td>\n<td>~3:25 p.m.<\/td>\n<\/tr>\n<tr>\n<td>Best for<\/td>\n<td>Swing trades, hedges<\/td>\n<td>Scalpers, day traders<\/td>\n<\/tr>\n<\/table>\n<h2 id=\"when-nrml-is-the-right-choice\">When NRML is the right choice<\/h2>\n<ul>\n<li>You are <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/hedging\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">hedging<\/a> a delivery portfolio with Nifty puts and want the hedge to live for weeks.<\/li>\n<li>You are running a <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/covered-call\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">covered call<\/a> on a stock you already own.<\/li>\n<li>You have a multi-day directional view on Bank Nifty or a stock future.<\/li>\n<li>You sell options on expiry day after the 3:30 p.m. cut-off; only NRML works in that scenario.<\/li>\n<\/ul>\n<h2 id=\"frequently-asked-questions\">Frequently asked questions<\/h2>\n<div>\n<h3 id=\"can-i-convert-mis-to-nrml-during-the-day\">Can I convert MIS to NRML during the day?<\/h3>\n<p>Yes, as long as you have enough free margin to meet the higher NRML requirement. Brokers usually allow conve<a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/rsi\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>rsi<\/a>on until shortly before MIS auto square-off.<\/p>\n<h3 id=\"is-nrml-available-in-cash-equity\">Is NRML available in cash <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/equity\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">equity<\/a>?<\/h3>\n<p>No. NRML is a derivatives-segment concept. Cash equity uses CNC (delivery) and MIS (intraday).<\/p>\n<h3 id=\"what-if-my-nrml-option-expires-in-the-money\">What if my NRML option expires in-the-money?<\/h3>\n<p>For stock derivatives, you must take or give delivery of the underlying shares. For index derivatives, the position is cash-settled.<\/p>\n<h3 id=\"does-nrml-cost-more-in-brokerage\">Does NRML cost more in brokerage?<\/h3>\n<p>Brokerage is identical for MIS and NRML &#x2014; the difference is only in margin and square-off behaviour.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>NRML &mdash; short for &ldquo;Normal&rdquo; &mdash; is the product type you pick when you want to carry a futures or options position beyond the same trading day. It uses the full exchange-mandated margin and does not get squared off automatically, making it the standard choice for swing traders and hedgers in the F&amp;O segment. Key [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"menu_order":0,"template":"","meta":{"_uag_custom_page_level_css":"","footnotes":""},"class_list":["post-12222","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"uagb_featured_image_src":{"full":false,"thumbnail":false,"medium":false,"medium_large":false,"large":false,"1536x1536":false,"2048x2048":false,"web-stories-poster-portrait":false,"web-stories-publisher-logo":false,"web-stories-thumbnail":false},"uagb_author_info":{"display_name":"Team Lemonn","author_link":"https:\/\/lemonn.co.in\/blog\/author\/ashu\/"},"uagb_comment_info":0,"uagb_excerpt":"NRML &mdash; short for &ldquo;Normal&rdquo; &mdash; is the product type you pick when you want to carry a futures or options position beyond the same trading day. It uses the full exchange-mandated margin and does not get squared off automatically, making it the standard choice for swing traders and hedgers in the F&amp;O segment. Key&hellip;","_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/12222","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/3"}],"version-history":[{"count":0,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/12222\/revisions"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=12222"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}