What is CNC and MIS in Zerodha?

If you're new to trading on Zerodha, two words that will confuse you right away are CNC and MIS. You open the Kite app to buy a stock, and boom, it asks you: “Product type: CNC or MIS?” Your mind goes: “What is this ?” Don't worry. This blog explains "What is CNC and MIS in Zerodha?".

What is CNC?

CNC stands for Cash and Carry. Use this when you want to buy and hold stocks in your Demat account for more than one day. It's like buying gold today and keeping it in your locker. You can sell it whenever you want, next week, next year, no pressure.

For example:

You buy 10 shares of TCS at ₹3,500 using CNC.
The full amount (₹35,000) is paid from your account.
Shares go into your Demat account.
You can sell them anytime. No time limit.

Key Things About CNC:

No margin or leverage. You need all the money.
You own the shares.
Used for long-term investing.
No auto square-off.
No brokerage charges on delivery trades in Zerodha.

Features:

You can buy and hold stocks for more than one day.
No margin or borrowing, you must pay the full amount.
No interest charges.
Best for long-term investors.

Benefits:

You get full ownership of the shares.
You are eligible for dividends, voting rights, etc.
Low risk because you’re not affected by daily market ups and downs.
You can sell anytime, next week, next year, no pressure.
No brokerage charges on CNC (delivery) trades in Zerodha.

What is MIS?

MIS stands for Margin Intraday Square-off. Use this when you want to buy and sell the same stock on the same day (called intraday trading). It's like borrowing your friend’s bike in the morning and promising to return it by evening. You enjoy the ride but can’t keep it overnight.

For example:

You buy 100 shares of ICICI Bank at ₹1,000 using MIS.
Zerodha gives you margin. So you may only need ₹20,000 instead of ₹1,00,000.
You must sell before 3:15 PM same day.
If you forget, Zerodha auto-sells it and charges ₹50.

Key Things About CNC:

For intraday only.
You get a margin (borrowed money).
Higher risk, but faster trades.
Must square off before 3:15 PM.
Used for stocks, futures, and commodities.

Features:

You get leverage, meaning you can buy more shares with less money.
You must sell your position before 3:15 PM, else Zerodha will auto square-off.
Needs less capital compared to CNC.
You can trade in stocks, futures, options, and commodities using MIS.

Benefits:

Higher profit potential with less money, thanks to leverage.
Low margin needed to enter trades.
Great for day traders looking for quick moves in the market.
Auto square-off helps close trades on time and manage risk.

How to Use CNC and MIS in Zerodha?

Place/Buy a CNC order in Zerodha

Follow the steps below to place a CNC order in Zerodha:

Open the Zerodha Kite app and log in with your credentials.
Scroll through the watchlist and select the stock you want to buy.
Click on the “buy” option to proceed.
Select the product type as “CNC” and enter the price and quantity required. The software will automatically carry forward the shares at the end of the trading day.
Finally, swipe to place your order and buy the shares.

How to Sell CNC Orders in Zerodha?

Follow our steps to sell a CNC order in Zerodha:

Log in to the Zerodha Kite app using your User ID and password.
Click on the hamburger menu, and click on the “Sell” option.
Enter the number of shares you want to sell in the “OTY” section and select the order type as CNC.
Enter the desired CNC limit price. Fill in all the relevant details and click on “Sell”.
After this, you will be redirected to CDSL. fill in the T-Pin provided to you at the time of registration.
Once you enter the T-Pin, you will be authorized to sell your shares.

Place/Buy an MIS order in Zerodha

Below are the steps:

Open the Zerodha kite app on your device and log in with your user ID and password.
Scroll through the watchlist and select the stock you want to buy.
Click on the “buy” option to proceed.
Select the product type as “MIS” and enter the price and quantity required. Make sure to square off the intraday position by 3:20 p.m.
Finally, swipe to place your order and buy the shares.

How to Sell MIS Orders in Zerodha?

The procedure is the same as selling a CNC order. However, you can put a sell MIS order in Zerodha using any order type like a limit order, market order, or stop-loss order. You can also place a cover order for a sell MIS order.

Make sure to select the product type as MIS while placing the order. This is essential as the trade parameters will depend on the order type you choose.

Conclusion

In Conclusion, now you know exactly what CNC and MIS mean in Zerodha. CNC is for long-term investment. And MIS is for quick intraday trading. Just remember:

CNC = Full money + long-term = Safe
MIS = Borrowed money + short-term = Risky

Use CNC if you're an investor. Use MIS if you're a trader. Choose wisely.

About the Author

Khushi Singla

As a writer, my task is not only writing but making tough topics easy to understand. I have the ability to connect with the readers and deliver them the best piece of writing.

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