i read your thread, but due to my own continuous deployment starting many years ago, i cannot keep moving funds around in Debt instruments. It will defeat the purpose of LTCG(3 yrs min holding for indexation) plus i need to book gains and that is a burden for that FY as tax slab is higher.
I have concentrated my liquid collaterals in various liquid/money mkt funds. Last 3-5 yrs we were in downcycle but currently one can concentrate more in GILT and lock-in better rates.
Holding TF should be longer to benefit so one can spread it.
Gilt have underlying with govt bonds and are the safest. MMF have up to 1yr maturity and are reasonably safe. overnight to me is extra-cautionary
Regarding Margin:
Overnight positions require min 50% from liquid collaterals and i have pledged portf too so 50:50 rule gives adequate margin.
Intra has no such requirement, even non-cash component is enough. Margin is applicable for margin-positions only, not buying in CNC or long-options etc
Penalty arises only on cash amount that is not sufficient for overnight. Intraday margin shortfall penalty is not passed on as per current rules. That is why margin requirements have gone up a bit.
Entirely options selling is ideally the best utilization of pledged collateral. That is why synthetic futures is sometimes preferred over Futures contracts, no daily MTM and hence very less FREE cash required.
Even BUY side legs get credit(funding) from premium rec'd.
Since i'm mostly in index, FAR month Nifty contracts are also quite liquid.
I have completely avoided any pledge instrument that gives a periodic interest payout like some G-Secs, LiquidBees etc bcos that gets added to your current FY income. Anything that is MF-Growth option is what I choose.
We need to remember that Dividends from portfolio( some FDs etc) also contribute to annual income but this cant be purely avoided.
Ofc, ppl can buy portf though ETF/MF with growth option too instead of individual stocks.