MIS Order – Were You Aware of these Facts??

MIS full-form in the share market is Margin Intraday Square-off. These order types are used for intraday trades when you don’t seek the delivery of shares. Shares bought in MIS order have to be squared off the same day. 

This article covers all about MIS Order. 

Content: 

• MIS Meaning in Share Market
• MIS Trading Timing
• Benefits of MIS Order
• Disadvantages of MIS Order
• How to place an MIS Order in Alice Blue?
• Quick Summary

MIS Meaning in Share Market

MIS full-form in share market is Margin Intraday Square-off. These order types are used for intraday trades when you don’t seek the delivery of shares. Shares bought in MIS order have to be squared off the same day. If you don’t do it yourself, your broker will do it on your behalf. What works well in MIS orders is your broker gives you the margin to buy shares for up to 5X of the amount you have. MIS gives you a chance to buy large volumes of shares. 

MIS Trading Timing

Timing plays a big role in MIS order. No matter at what point of the day you buy a stock, you have to sell it before the market closes. Thus, entry and exit positions have to happen on the same day. If you don’t close your position yourself, it will be done automatically between 3.15 pm and 3.20 pm by the broker (the exact timing differs from broker to broker). 

For example, if you buy 100 shares of Reliance Industries in the morning, you have to sell them before 3:20 pm; otherwise, your broker will automatically sell them and credit the amount to your trading account after deducting the brokerage fees.

Benefits of MIS Order

• MIS order allows you to trade large volumes of shares, thanks to the leverage your broker provides you. For example, if you have the capacity to buy ₹1 lakh worth of shares, you may potentially take positions for up to ₹5 lakh with margin money provided by your brokers. The amount of leverage depends on the liquidity and volatility of the stock and differs with different brokers. 
• Auto square-off limits your losses (if it comes to that) because if the stock goes on a free fall, at least you would be out of it the same day. 
• If you don’t want to square off your positions, you can convert your order to CNC, which is the delivery-based order type. 

Disadvantages of MIS Order

• Taking leveraged positions in MIS orders may backfire. If the stock reacts opposite to what you had expected, your losses could be huge. Not only would you lose your own money, but you would also have to pay back to your broker. 
• MIS orders require constant attention throughout the trading day. 
• Brokerage fees and taxes are higher in the case of MIS orders. 

Also read: CNC Vs MIS Order. 

How to place an MIS Order in Alice Blue?

Below are the steps that would help you place an MIS order easily. 

1. Choose the stock/F&O of your choice.

2. Select whether you want to buy or sell the stock.
3. Select MIS, which stands for Margin Intraday Square Off.

4. Select whether you want to place a market order or a limit order.

5. Enter the quantity and price (in case of limit order.)

6. Enter stop loss value or trigger stop-loss tick size.
7. Enter the trigger price at which you would like to pocket the gains.

To get a detailed understanding, watch our youtube video on How to Place orders on ANT MOBI. 

We hope that you are clear about the topic. But there is more to learn and explore when it comes to order types, and hence we bring you the other important order types that you should know:

Quick Summary

• MIS full-form in the share market is Margin Intraday Square-off.
• These order types are used in intraday trades when you don’t seek the delivery of shares. 
• Shares bought in MIS order have to be squared off the same day.
• Entry and Exit have to happen on the same day. If you don’t do it, it will be done automatically between 3.15 pm and 3.20 pm (the exact timing differs from broker to broker).
• Benefits of MIS Order
  • MIS order allows you to trade large volumes of shares, thanks to the leverage your broker provides you.
  • Auto square-off limits your losses
  • If you don’t want to square off your positions, you can convert your order to CNC, which is the delivery-based order type. 
• Disadvantages of MIS Order
  • Taking leveraged positions in MIS orders may backfire. If the stock reacts opposite to what you had expected, your losses could be huge. 
  • MIS orders require constant attention throughout the trading day. 
  • Brokerage fees and taxes are higher in the case of MIS orders.