When you place an Intraday order and message display on your screen that auto Square off block, it is quite confusing for the new traders. However, the online trading platforms keep it to make trading simple for retail investors.
Let’s understand the means of Auto Square off Block and related terms in this post.
Table of Contents
What is Auto Square Off?
A square off is a trading strategy in which a trader purchases or sells shares for a day in the expectation of profiting. By the conclusion of the day, the investors should have closed their positions.
Some brokerage firms offer an auto square off service, in which the positions are instantly squared off at a predefined period.
Auto square off charges in angel broking
If you will not square off your position and it remains open after the given timings some brokerage firms are also charging a penalty for that. Mostly it is around rs. 50/- Per trade.
Now let’s talk about auto square off block.
What is Auto Square Off Block?
After the Risk Management System (RMS) auto square off time, which is 3:20 pm for equities and 3:25 pm for Futures and Options markets, MIS orders cannot be placed. Currency markets close at 4:45 p.m., while commodity markets close at 11:05 p.m.
If a trader tries to put a MIS order past the cut-off periods, the order will be denied and “Auto Square Off Block” or “RMS: Auto square off block” errors will appear.
Example of auto square off time in angel broking
Let’s assume a trader hears news about xyz company before it is out in the market and wants to cash the trend.
If he didn’t look at the time and directly try to place an order and the timing is around 3:22 pm. The order will be not executed and Screen display the error Auto Square Off Block.
So please keep in mind that timing is important to avoid this error.
Advantage of Auto Square off Block
- It reduces the risk of loss for traders as market closure time is 3:30 pm.
- The Final closing rate is marginally different from the actual rate of stock, so it is necessary to close the orders before 10-15 mins.
- It also helps in reducing the last moment volatility.
Disadvantage of Auto Square off Block
- It minimizes the chances of last moment profit.
- It also brings down the chances of recovering loss at the last moment if your intraday position is in loss.
- Some Announcements or news comes just before market closure, However, due to auto square off block you cannot ride the moment intraday you need to buy the stock in cash.
Like any other feature every feature has few advantages and few disadvantages. However, overall this option is in favor of traders.
Conclusion
Sometimes traders get negative feelings about this feature but some rules are necessary to keep everything in order. So next time while you are placing an order keep timing in your mind to avoid this error.
This is all from our side regarding auto square off block meaning. However, if you have any doubts you can just comment below.
Other Interesting blogs related to auto square off block meaning.
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How to choose stocks for intraday trading?
How to Earn Money in Share Market Daily?
FAQ Regarding auto square off charges in angel broking
Auto square off charges?
If the brokerage firm auto squares off your position then charges are rs. 50 per trade.
What is auto square off?
The Brokerage firm closes your Intraday position automatically 10-15 mins before the closure of the market.
Zerodha auto square off time?
The timing for auto square off in zerodha is 3:20 pm for equities and 3:25 pm for F&o segment.
auto square off timing in Upstox?
You need to square off your position Before 3:00 to avoid an auto square of charges.
auto square off block timing angel broking?
The timing for auto square off in Angel broking is 3:15 pm for equities and F&o segment.
