What Are Auto Square Off Charges In Intraday Trading?
- 9th October 2025
- 12:00:00 AM
- 5 min read
As of FY25, 10.7 crore investors directly invest in the stock market, showing an increasing interest of Indians towards investments or trades. If you are one of them looking for trades, especially intraday trading, you must learn about auto square-off charges, as it is essential in intraday trades.
An Overview of Auto Square-Off in Trading
When you hear the term auto square-off charges, you must know what auto square-off is first for a better understanding. Here is a detailed breakdown of the process:
- When you participate in intraday trading and enter a position under the Margin Intraday Square-off order type, the concept of auto square off applies.
- Squaring off represents the closing of such a trading position. Suppose you have bought 100 shares of a company at INR 500 each at 9:15 AM and sell them at INR 520 each before closing.
- From the shortselling perspective, auto square off applies when you repurchase shares before the stipulated time. Suppose you short-sell 50 shares of a company at INR 300 each and buy them at INR 280 each, making an INR 1000 profit. This implies a square off.
Auto Square-Off Charges In Intraday Trading and Timings
Now that you have an understanding of what is auto square-off, look at how auto square-off charges apply to intraday trading:
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Charges for Auto Square-off
Here is a breakdown of this concept in intraday trading in India:
- Suppose for any of the reasons, such as internet stability issues or if you simply forget to close the positions, your broker will close these positions for you.
- For this service, they will levy a nominal charge from you, known as the auto square-off charges. It is a flat fee charge with GST that applies to the profits or losses that you accrue as a trader and varies between brokers.
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Timing for Auto Square-off
Talking about the auto square-off timing, it varies between brokers and depends on the segment. However, it typically happens on the following timelines:
- For the equity cash segment in NSE or BSE, the timing is between 3:15 PM to 3:20 PM IST.
- For segments like Future and options, automatic square-offs take place between 3:15 PM and 3:20 PM IST.
- In the currency segment, the timing is between 4:45 PM and 4:50 PM, as the currency market ends later.
- For the commodity, it is 25 minutes before the respective market closes.
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What is the Effect of Auto Square-Off Charges on Profits?
- The securities market is volatile, and thus, prices might change overnight. For example, a share bought at INR 500 today might open at INR 470 the next day, causing an INR 30 loss per share. Therefore, Auto square-off might safeguard your profit from such overnight swings.
- However, even if you make a profit from the trade, the auto square-off charges by the broker increase your expenses.
Example of Auto Square-off Charges in Intraday Trading
Suppose you are participating in intraday trading and open two intraday positions, but somehow forget to close them before the deadline.
The Risk Management System (RMS) by your broker acts and closes these open positions automatically.
- Now, consider the square-off charge is INR 50 plus GST. As you have two positions open, the implied charge would be INR 100.
- With an applicable GST of 18% this increases to INR 118. This is the additional charge that you must pay, and it will reflect in your ledger.
Conclusion
Auto square-off charges are the fee that your broker imposes if you do not manually close your intraday positions. Such a charge varies between the brokers and safeguards you from losses that you might incur if the held positions carry over to the next day.
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Frequently Asked Questions
1. What happens if I don’t square off my position in intraday trading?
If you do not square off your position on the same day, your broker will square it off. They will charge nominal auto square-off charges.
2. Can I avoid auto square-off charges?
Yes, you must manually square off your intraday position before the deadline as per the security segment to avoid the charges.
3. How can I prevent auto-square off in intraday trading?
When you participate in intraday trading, note the square-off time of the security you are trading in. Square off the position before that time and prevent the charges.
4. Are auto square-off charges refundable?
As your broker performs this square-off by themself, it is considered a fee and therefore might not be refundable. However, you must consult with your broker for refund-related concerns.
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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
