What is the full form of EMF in the Share Market?

The EMF full form in the share market is Exchange Margin Funding. An EMF is an order that is placed by keeping or transferring the shares into margin funding. It is enough if the investors pay only up to the haircut value of the EMF in order to place their order. EMF helps investors to retain their position and improve their buying power, eventually resulting in higher returns.

Features of Exchange Margin Funding:

With the help of EMF, investors can buy more securities than what they could, with their funds. Securities in the investor’s accounts can be used as collaterals for borrowing funds. Suppose the value of the collateral falls below a certain point. In that case, the broker might issue a margin call, and the investor is expected to deposit additional funds or sell his securities to cover the shortfall. It is a high-risk investment strategy, as it can amplify both profits and losses.

Advantages of Exchange Margin Funding:

EMF allows investors to buy more securities than what they can actually buy through other funding methods. This helps them to enjoy a higher ROI. By borrowing funds to increase their investments, investors can leverage price movements and favorable market conditions to increase their gains.