Shares of the Jio platform can be purchased from day one through the Margin Trading Facility, i.e., MTF. Know what is Margin Trading Facility, how it works and how much risk is there in it.
Jio Platforms Share: Jio shares for less money?
Want to invest in the stock market, but don't have the funds to buy shares? Margin Trading Facility (MTF) is an option for such investors. Shares of Reliance Industries' digital and telecom company Jio Platforms can also be purchased through this facility from the first day of listing.
Jio Platforms shares are being listed on the stock exchange on October 28, 2026. According to the NSE circular, trading in the shares will begin on the first day. Meanwhile, through MTF, investors can borrow the remaining funds from their broker by paying a small amount instead of paying the full share price out of their own pocket. Let's understand MTF in simple terms and how it will work when purchasing Jio shares.
What is MTF?
MTF, or Margin Trading Facility, is a method of investing in the stock market. Investors don't have to invest all of their own money to purchase shares. They pay a portion of the share price and receive the remaining funding from their broker. MTF doesn't mean free shares; interest is paid on the amount borrowed from the broker, and losses increase if the share price falls.
For example, you want to buy shares worth ₹50,000, but you only have ₹25,000. If your broker allows a 50% margin for this trade, you can invest ₹25,000 yourself and fund the remaining ₹25,000. The broker may charge you interest and fees depending on the terms and conditions.
How will MTF work in Jio Share?
The price band for Jio Platforms' IPO is ₹1,065 to ₹1,119 per share. Once the company's shares are listed on the stock exchange, they will be traded on the exchange. Investors purchasing through the MTF will be required to trade at the prevailing market price at the time.
For example, if Jio shares are trading at ₹1,200 after listing and you want to buy 100 shares, the transaction value is ₹120,000. If your broker's terms require you to invest 50% of the funds yourself, you'll need to pay ₹60,000, and the remaining ₹60,000 will be funded by the broker. After this, you'll need to pay the borrowed funds, interest, and other fees.
What are the advantages and disadvantages of MTF?
The biggest advantage of MTFs is that even with limited funds, investors can purchase shares worth more than their capital. If the stock price rises as expected, the return can exceed the amount invested. However, the disadvantage is that even if the stock price falls, the money borrowed from the broker must be returned, and interest is also charged.
