I am unable to place an order for a particular stock with an error "Squaring only permitted". Why?
One of the reasons for this error is that a security is sold from the Client Unpaid Securities Pledgee Account (CUSPA) due to non-clearance of dues. In cases where shares were purchased using margins and the payment for delivery was not made, Geojit's RMS (Risk Management System) will sell these shares (and square off your position) on T+5. Hence, you will not be able to buy these shares on T+5.
For example, Mr Lal buys 1000 shares of State Bank of India on Jan 1st, Monday using pledge margins for the entire order. He fails to bring in funds for this trade by T+4. In the morning on T+5 (7th Jan, Monday), Geojit's RMS will sell these 1000 shares to close his position. As a result, he will not be allowed to buy shares of State Bank of India on 7th Jan. There are no trading restrictions from the next day.
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