The cash equity segment in Zerodha refers to the section of the stock market where investors can buy and sell stocks for delivery, also known as equity delivery trades. In this segment, you are required to pay the full price of the stock upfront, and the stocks are then delivered to your Demat account, where you can hold them for as long as you want. Zerodha offers a product type called CNC (Cash and Carry), which is used for equity delivery trading without any leverage.
Key Features of the Cash Equity Segment in Zerodha:
- CNC (Cash and Carry) for Delivery Trading
In the cash equity segment, the CNC product type is used for purchasing shares to hold for the long term. There is no leverage provided for CNC orders, meaning you need to have the full amount of the trade in your account. Shares purchased via CNC can be held indefinitely in your Demat account. - Brokerage-Free Delivery
One of the key benefits of using the cash equity segment on Zerodha is that there is no brokerage fee for equity delivery trades. This makes it highly cost-effective for long-term investors. - T+1 Settlement
For stocks bought using CNC, you can sell them the next day (T+1) using a strategy called BTST (Buy Today, Sell Tomorrow), though this involves certain risks like price fluctuations before the shares are credited to your Demat account. - Intraday and CNC Distinction
While CNC is used for delivery-based trades, if you buy and sell the same stock on the same day under CNC, it will be considered as an intraday trade, and regular intraday charges will apply.
Why the Cash Equity Segment is Important for Investors:
- Long-Term Investment: Ideal for investors who wish to hold stocks for the long term, as the stocks are delivered to their Demat account without any additional margin requirements.
- Cost Efficiency: With zero brokerage fees on delivery-based trades, this segment is highly beneficial for investors aiming for long-term capital growth without frequent trading.
FAQ
- What is the Cash Equity Segment in Zerodha?
The cash equity segment is where investors can buy shares for delivery using the CNC product type. Stocks bought here can be held long-term in your Demat account. - Is there any brokerage for cash equity trades on Zerodha?
No, Zerodha offers brokerage-free equity delivery trades under the CNC product type. - What is CNC in Zerodha?
CNC stands for Cash and Carry, and it is the product type used for equity delivery trades in the cash equity segment without any leverage. - Can I sell shares on the same day using CNC?
Yes, but the transaction will be treated as an intraday trade, and intraday charges will apply. - Is leverage available in the Cash Equity Segment?
No, leverage is not available for CNC trades in the cash equity segment. You must have the full amount in your trading account to execute the trade.
The cash equity segment in Zerodha is perfect for long-term investors looking to buy and hold shares with no additional costs and complete control over their investments.