Earn Extra 5% by RENTING your Shares | Stock Lending and Borrowing Mechanism

Earn Extra 5% by RENTING your Shares | Stock Lending and Borrowing Mechanism | SLBM

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In this video, we're diving deep into SLBM, the Stock Lending and Borrowing Mechanism, a lesser-known yet powerful tool that can help you maximize your stock market investments. The concept, although not very popular in India, has been around for over a decade and involves 3 parties - the lender, the borrower and the exchange. As a framework, SLBM benefits everyone involved as it enhances market liquidity, aids in short selling for better price discovery, and helps manage risk through hedging.
The return one can receive from stock lending depends on the current market rates which has been explained in the video using an example. Pleasantly, the lending fee received on an SLBM transaction is in addition to what the shareholder can earn from dividends and capital gains. So, if you're looking to unlock an additional stream of income from your stocks and make your investments work even harder for you, dive into the world of SLBM
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👉 Video Chapters:
00:00 Stock Lending and Borrowing Mechanism
00:36 What is SLBM
01:54 SLBM Process
04:34 Benefits of SLBM
05:16 Features of SLBM
07:07 Is SLBM Safe?
08:12 Benefits to Borrowers
10:16 Benefits to Lenders
11:11 SLBM Returns (Stock Lending & Borrowing Rates)
12:57 Impact of Corporate Actions
13:46 SLBM Charges, Brokerage and Taxation
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#slbm #stocklendingandborrowing #stockmarket
Disclaimer: I am not a SEBI registered investment advisor or research analyst. I am not registered with PFRDA or IRDA either. The content posted on this platform is purely for educational purposes and none of it constitutes investing or trading advice. Viewers should do their own research and diligence before investing or acting on the information presented. Some of the links I have posted in the video, the description, the comments and other related resources might be affiliate links

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@shankarnath 11 ай бұрын

The thumbnail for this video uses elements (the logo & background) from my favourite musical - RENT. Brilliantly written & composed by Jonathan Larson, it tells the story of a group of impoverished young artists struggling to survive and create a life in Lower Manhattan’s East Village. The musical is the 11th longest running show on Broadway with over 5,000 performances, has won numerous awards & grossed over $280 million RENT is one of those musicals that you’ll either love or hate. It has 42 songs - and I remember every one of them :) .. here’s a ranked list of my favourites: 1. I’ll Cover You (Reprise) 2. Seasons of Love 3. La Vie Boheme 4. Goodbye Love 5. Another Day 6. One Song Glory The show was adapted into a motion picture featuring six of the eight principal cast members from the 1996 stage premiere. It should be available in some streaming service. And that’s the story behind this thumbnail :)

@anmolagarwal5297 10 ай бұрын

Mo❤I

@karanbabakhan 10 ай бұрын

Please let me know how to Use SLBM on groww

@ythelper3478 8 ай бұрын

You got information about how to activate on groww

@anuraggaud6607 10 ай бұрын

My God!, I am hearing this concept for the first time. Even after being well-versed in the stock market, I didn't know about this. There is a lot to learn in the market. Thank you Shankarji!

@shankarnath 10 ай бұрын

Glad it was helpful! Most welcome 🙌

@syedismail2831 10 ай бұрын

Agree! Same here

@vikasgoel5182 10 ай бұрын

can't agree more, I think till now it was missed opportunity as I am a long term investor and I could have made extra bucks

@Virus2op 5 ай бұрын

It was actually there in foreign countries

@archanar3351 5 ай бұрын

Eye opener!! I am learning about something called SLBM for the first time and I have been dabbling with the markets for the last 7 years. Thanks so much for sharing invaluable knowlege. If you are going to do a detailed video with a real example, we would all benefit more and get confident enough to to try. Thanks again.

@shankarnath 5 ай бұрын

Thank you for the appreciation & suggestion

@shuvampargal4754 10 ай бұрын

been in the market for many years but still learnt something new today. Kudos to you team

@shankarnath 10 ай бұрын

Glad to hear that! 🙌

@SatyamRaina 11 ай бұрын

You never fail to deliver knowledge that helps the individual retailer thrive in the financial markets. Quality stuff!!

@shankarnath 10 ай бұрын

Glad you think so! Happy to know that my content helps people understand investing better.

@vcsvenk 10 ай бұрын

Very kind person you are, for sharing your team members contributions. That's really great and completely new to me about this topic. Great.

@shankarnath 10 ай бұрын

Thank you very much and I'm glad the video was helpful!

@pharaohakhneton9553 10 ай бұрын

Very informative content. This is for the first time I came to know about lending and borrowing of shares permitted legally. The purpose of learning is to know new things every day. That purpose is served today.

@shankarnath 10 ай бұрын

Glad you found it helpful!

@KirtiRanjan 11 ай бұрын

Some real knowledge being shared in this channel. Time and again. Great work by the team

@shankarnath 10 ай бұрын

Much appreciated! Thank you very much for your kind appreciation

@zenobiasanchawalla4339 11 ай бұрын

Very informative content, heard about SLBM sometime back and wanted to try it myself but was never able to due to lack of knowledge. Will surely try now after watching your video Shankar and super knowledge share 👍

@shankarnath 11 ай бұрын

Great to hear! Yes, even I knew nothing about it .. but upon research, many of the big and small parts of it got clarified.

@anujoybardhan 10 ай бұрын

Great job Shankar!! This is something new for me, didn't know about the SLB mechanism at all!! Although on checking the list, non of the shares in my holding are being demanded by borrowers, I guess will have to keep checking form time to time. Also it would be great , if you could show with example , how to go about doing this on any of the brokerage platforms you mentioned..Looking forward to your videos!!

@shankarnath 10 ай бұрын

Thank you for the suggestion!

@phanikiran3884 5 ай бұрын

This is precise, to-the-point, Comprehensive, Value adding-Wishing this channel should reach a million subscribers in next 2 months. Many thanks Mr Shankar Nath & to the entire team for such an insightful video on SLBM.❤

@shankarnath 5 ай бұрын

Thank you so much 😀

@ravinderk1 10 ай бұрын

I never miss any video of your Mr.Shankar. And, you never disappoint. Thanks a bunch!

@shankarnath 10 ай бұрын

So nice of you. I'm very happy to be playing a small part in your financial journey!

@yogeshpatel3359 6 ай бұрын

Thats calls a knowledge and information... I haven't expected such things to exist ... I immediately subscribed to the channel. 😊

@shankarnath 6 ай бұрын

Welcome aboard! Glad you liked my work

@jayadevtn1987 11 ай бұрын

Will have to explore further and understand this. Thanks for detailed video .

@shankarnath 11 ай бұрын

My pleasure. Glad it was helpful

@SARTHAK15bhatnagar 11 ай бұрын

Thank you Shankar for sharing such an informative video. I will now research more on this. Thanks Again

@shankarnath 10 ай бұрын

My pleasure. Glad you found it useful 🙌

@prashanthbelur169 11 ай бұрын

As always, lot of data and very good info. I like your content and the depth of the content.

@shankarnath 10 ай бұрын

I appreciate that! Thank you very much 🙌

@nishanmadhavan 11 ай бұрын

Very informative content. And it's nice of you to introduce people who are working behind the scenes.

@shankarnath 11 ай бұрын

Glad you liked it! Kartar, Kunal & Akhil were surprised as they didn't know anything about me mentioning them (Rohit knew as he's the one who edited this video)

@drstrange404 4 ай бұрын

I wish this process of SLB becomes more streamlined so that retail investors can increase participation ... in the US its much more easier for a retail individual to lend their shares and the market is also more liquid for SLB...

@mpsctricks9597 5 ай бұрын

For the first time hearing such a wonderful concept. I have been in share market since Corona but did not such a wonderful concept.will explore this one.

@shankarnath 5 ай бұрын

Glad it was helpful!

@avnishdave8369 5 ай бұрын

SLBM is very helpful for short selling and now on long-term investors also benefits

@mypassion4166 10 ай бұрын

Super rich content, sir. Thank you for this session. I had a request sir- please bring in analysis of energy sector and steel plants in India.

@shankarnath 10 ай бұрын

Thank you for the suggestion

@twinklegupta630 10 ай бұрын

This information is so elaborate. Thank you for sharing

@shankarnath 10 ай бұрын

Most welcome. Glad you found it informative

@drshilpaayurveda9439 10 ай бұрын

Thanks a lot for teaching new things!!!

@shankarnath 10 ай бұрын

My pleasure! Glad you liked it

@kaushalbhowmik2882 10 ай бұрын

Hi Shankar, loved the coverage of new concept in your video. Though i am still confused over what happens if the borrower is unable to pay back in the process of failed short selling.

@shankarnath 10 ай бұрын

Thank you

@sumiteshsinha5757 5 ай бұрын

knowledgable content delivered by amazing team, kudos to you guys

@shankarnath 5 ай бұрын

Thanks a ton

@baibhavRishu 11 ай бұрын

New information ℹ️, thanks a lot sir

@shankarnath 11 ай бұрын

Most welcome. Glad you liked it & found it informative

@aannkkiitt1 10 ай бұрын

Zerodha is charging 20% + GST for SLB. Seems way to high. Has anyone come across a more reasonable broker? I am also wondering do Mutual funds use this to generate extra return? Is that passed onto investor ? This way index funds should easily beat the index. Am I missing something ?

@ravijag73 3 ай бұрын

You meant AMCs doing this? Food for thought

@Randomcomment7699 5 ай бұрын

Shankar sir gratitude to content makers every one should learn

@shankarnath 5 ай бұрын

Thank you so much 🙌

@user-xd7rb9io1l 5 ай бұрын

A long time ago, I searched about SLBM...But everyone was giving half information which is totally confused me..😢..But Now this is 100% Clear for me..😊.. Thanks a Lot ❤

@shankarnath 5 ай бұрын

It's my pleasure

@shashankjaiswal3260 6 ай бұрын

Yeah i read this concept in MBA SAPM BOOK

@anilmm2005 2 ай бұрын

Very good, informative article SHANKAR and Team. I have to explore more and check with my Broker on how to take this ahead. Thank you.

@shankarnath 2 ай бұрын

My pleasure. Glad it was helpful!

@Vaidyanathan_K 10 ай бұрын

THANK YOU - ITS VERY GOOD INFORMATION FOR ME

@shankarnath 10 ай бұрын

So nice of you, glad you liked it

@priyanshishah5905 6 ай бұрын

Great content, thanks!!!

@shankarnath 6 ай бұрын

Glad you liked it!

@curiousnoobs8903 9 ай бұрын

Have few questions on this 1. Can we sell stock in between , would there be any additional process involved 2. Can we buy and sell options and perform stock settlement them on expiry

@shankarnath 9 ай бұрын

I'm sorry, these are a bit procedural and your brokerage will be in a better position to answer these. May I request you to check with their customer service. I've heard that different brokers might have slightly different rules so please watch out for that too

@thiyagusathya4613 11 ай бұрын

new infomation to me , thank u sir

@shankarnath 10 ай бұрын

Most welcome!

@gopikannans9246 10 ай бұрын

One more excellent session.

@shankarnath 10 ай бұрын

Thank you very much

@paraschugh3058 6 ай бұрын

You have great quality content. Keep making it for us, Sir!

@shankarnath 6 ай бұрын

Thank you Paras

@johnconnor1652 5 ай бұрын

Great content!! as always

@shankarnath 5 ай бұрын

Appreciate it!

@krjg9809 10 ай бұрын

SIR IN ZERODHA THEY ARE SHOWING THAT FOR LENDING YOU SHOULD MINIMUM HAVE 1 LAKH RUPEES WORTH OF A PARTICULAR STOCK ONLY THEN YOU ARE ELIGIGIBLE TO LEND. AND TRASACTION COST IS 20% WHICH IS TOO HIGH. I DON'T THINK THIS IS FOR ME. MY HOLDING IS WORTH AROUND 1.5L BUT NOT A SINGLE STOCK HAS INDIVIDUAL HOLDING OF MORE THAN 50k😔

@SuperNimbus 5 ай бұрын

Transaction Cost is 20% of the lending price, not the stock price

@mr.talkstock7282 10 ай бұрын

Excellent & very informative video

@shankarnath 10 ай бұрын

So nice of you. Thanks Ali

@gauravlakhina8412 10 ай бұрын

thank you so much, very well explained and everything was there needed to know ❤

@shankarnath 10 ай бұрын

You're so welcome! Glad it was helpful

@TheSaurabhkothari 5 ай бұрын

Amazing knowledge gain from your session always❤

@shankarnath 5 ай бұрын

Glad to hear that, thanks!

@369Thinkandgrow 5 ай бұрын

New information to me. Subscribed immediately.

@shankarnath 5 ай бұрын

Welcome aboard!

@gurunadhmummani 6 ай бұрын

Dear Shankar sir very useful video ❤

@shankarnath 6 ай бұрын

So nice of you. Thank you very much 🙌

@drdhimanbhatta1347 10 ай бұрын

Fantastic 😍 informations Shankar Babu. Hope you are doing well ❤.

@shankarnath 10 ай бұрын

Thank you very much

@Pvishy 10 ай бұрын

Thanks to your team for putting in such thorough research and helping me

@shankarnath 10 ай бұрын

Most welcome. Our pleasure!

@arvindian 10 ай бұрын

Bata India was a very convenient example

@Harshaalu 10 ай бұрын

does short selling requires shares to be held in demat account ?

@satheshkumar5870 10 ай бұрын

Good information video 📸 Thank you

@shankarnath 10 ай бұрын

Glad it was helpful! 🙌

@prakadox 4 ай бұрын

Thanks for the information!

@shankarnath 4 ай бұрын

Most welcome

@hiteshjoshi1071 10 ай бұрын

Do mutual funds lend shares to enhance returns?

@nagarajan6043 4 ай бұрын

Very informative. Learned another new one in stock market❤slbm❤

@shankarnath 4 ай бұрын

Glad it was helpful!

@kirankumarpansuriya5751 6 ай бұрын

Thanks for details

@shankarnath 6 ай бұрын

Always welcome

@rudrakumar9943 4 ай бұрын

Thank you sir Very informative

@shankarnath 4 ай бұрын

Most welcome!

@bideshroy486 10 ай бұрын

Thanks Shankar bhai for the video. Can you please make a video on ETF investment and it trading strategies

@shankarnath 10 ай бұрын

Glad you liked it and thanks for the suggestion

@naresh6400 10 ай бұрын

Excellent explanation

@shankarnath 10 ай бұрын

Glad you liked it

@arvindgandhi1007 11 ай бұрын

Thank you very much 🙏

@shankarnath 10 ай бұрын

You're most welcome

@akhil5658c 4 ай бұрын

I knew something like this would be there but always hesitate to ask.I am using this feature on crypto though from past 4 yrs especially on kucoin exchange anyways nice content thnks for info

@rongala81 10 ай бұрын

Something like this concept "Vauld" has done we buy Crypto and giving interest in happy scenario everything will be fine if it did not worked bankrupted. In the above video if borrower got loss in shortsell then what? If loss is more which include 1%? Can you please explain same scenario in 25 Lakhs or Crores of rupees instead of thousands Thank you

@hemansumody9441 5 ай бұрын

Awesome presentation

@shankarnath 5 ай бұрын

Thanks a lot

@user-xd7rb9io1l 5 ай бұрын

Sir Please Reply me... Kya HDFC SKY use karke SLB service avail karna possible hai??.. Please Reply 🙏

@BestOfThePodcast 5 ай бұрын

You deserve way more subscribers

@shankarnath 5 ай бұрын

Thank you

@bighnarajmisra5903 11 ай бұрын

Unfortunately ICICI Direct did not give these options to his clients.

@asdfgh5757 10 ай бұрын

Thanks for the info. Can we lend the pledged shares in this mechanism.

@shankarnath 10 ай бұрын

Most welcome. Sorry, I have no idea on pledged share; you'll have to check with your broker. I did read in a Zerodha page that pledged shares cannot be lent under SLBM. Link: support.zerodha.com/category/trading-and-markets/trading-faqs/securities-lending-and-borrowing/articles/lending-pledged-shares-slb#:~:text=No%2C%20pledged%20shares%20cannot%20be,credited%20to%20the%20borrower's%20account.

@leo91maniac 6 ай бұрын

Very nice informative video, Speaker is awesome😊

@shankarnath 6 ай бұрын

Thanks a ton

@rajarshinath5663 5 ай бұрын

You r great and glory to Nath Community.I want you to be my guru

@shankarnath 5 ай бұрын

Thank you very much 🙌

@rajarshinath5663 5 ай бұрын

@@shankarnath Pranam 🙏🙏.

@AD-iu2hr 9 ай бұрын

Awesome ❤

@shankarnath 9 ай бұрын

Thanks 🤗

@007aldrinbenny7 Ай бұрын

very useful

@shankarnath Ай бұрын

Glad to hear that

@MrDheerajassudani 10 ай бұрын

I am a big fan of yours and would like to meet you some day. Were you in Bengaluru Sarjapur area few months back. I believe I saw you near that area while in a cab and hence could not stop.

@shankarnath 10 ай бұрын

Thank you very much! Yes, I was in B'lore and around Sarjapur in May this year

@drkeval 10 ай бұрын

Very informative insight... thank you...i am active in stock market since 18 months... recently i get to know something about black market (DABBA MARKET) in gujrat...can you make a video on that just for educational purpose ?

@shankarnath 10 ай бұрын

Thanks for the suggestion

@BAP5779 10 ай бұрын

Hi Greatful if you can make video answering questions like one fund house buying schemes of another fund house and it's impact on performance, like MNP in mobile numbers, why MF STP cannot be done between funds houses, why so many ratings available making it difficult as one MF scheme will have different ratings.

@shankarnath 10 ай бұрын

Thanks for the suggestion

@AN-jd2yp 5 ай бұрын

Very good information

@shankarnath 5 ай бұрын

Thanks!

@Khushi30112 5 ай бұрын

Sir groww mai feature hai ki nhi 🙏 please bataiye

@saulgoodman980 10 ай бұрын

If one has to short, why would he prefer this over buying puts or selling calls?

@drstrange404 4 ай бұрын

Because options price is much more volatile than stocks... theta decay hurts option buyers alot...

@MrPrithwiraj Ай бұрын

@shankarnath does this SLBM mechanism work along with Smallcase investing through Zerodha?

@shankarnath Ай бұрын

Sorry, I'm not aware. You'll have to check with the smallcase/zerodha customer service team on the same.

@kaushiktalukdar8711 5 ай бұрын

Great 👍👍👍

@shankarnath 4 ай бұрын

Thank you

@MuraliKatta-jc7ir 10 ай бұрын

Thanks

@shankarnath 10 ай бұрын

Thank you very much Murali ji for your kind appreciation. I'm happy you found this video informative; thx for the gesture! 🙌

@tapanbanerjee7142 6 ай бұрын

If the shares under slbm transferred from my demat account, the holding period is broken! Am I right?

@Dushyantgiri 10 ай бұрын

Borrow the stocks at this interest rate annually? If yes this would make things awesome for many..

@sky301289 11 ай бұрын

Thank you

@shankarnath 10 ай бұрын

Very welcome!

@gauravgaur_in 5 ай бұрын

Do SBI securities provide as SLBM ?

@SWA2211 6 ай бұрын

Slbm under for stock give to lending but here limit price one lakh. this one lakh which type show here mean (invest amount+profit) ya only invest amount need here for lending process.

@user-ee5cm1cz7h 5 ай бұрын

Very helpful

@shankarnath 5 ай бұрын

Glad to hear that

@mahenderyadav7849 6 ай бұрын

As LUCID as it gets. Hats off to you Sir!🎉

@shankarnath 6 ай бұрын

Thank you so much, Mahendra ji

@Sidhnath.Prasad 6 ай бұрын

Sir, also discuss risk associated with SLBM

@shankarnath 6 ай бұрын

Hi, this was discussed in the video. The major risk for a lender is the close out risk

@nck927 5 ай бұрын

Is this only available in India？

@saulgoodman980 10 ай бұрын

Is the SLBM market big enough for the rental yields to be factored into the prices?

@shankarnath 10 ай бұрын

I'm not sure but this news item really caught my interest wherein on a single day, investors borrowed 95,99,987 shares of YES Bank worth Rs. 5.9 crore for an interest rate of around Rs 7 per share. So there is tactical opportunism here but in my view, the people using this route (as a part of turnover) is little. But come to think of it, therein lies the opportunity and if everyone starts doing this, the extra income will diminish

@karanbabakhan 10 ай бұрын

This was a pleasent surprise!. Please how to use SLBM on my stocks on GROWW

@shankarnath 10 ай бұрын

Thanks. Sorry, I'm not aware of Groww's process, you'll have to connect with the team there.

@lmnlegal3405 5 ай бұрын

Very good information and presentation sir. I want know that if the borrower of the shares from lender lose his money while short selling bor anything he made, then how he can pay the respective percentage of amount which he adhered.

@shankarnath 5 ай бұрын

Thank you! I'm sorry, I dont know about that. Maybe your brokerage RM can clarify this part

@Shiv_Synthetic 6 ай бұрын

great video

@shankarnath 6 ай бұрын

Thank you

@ChaudharyAnkit1602 6 ай бұрын

Sir. Which all platforms allow slbm, seems like it doesn't exist for Upstox.

@shankarnath 6 ай бұрын

I'm not sure, sorry! Maybe a search on Google might help

@prakadox 4 ай бұрын

On thinking about this a little more, I think I can understand that being offline, there just seems to be too much friction in the setup to justify what are essentially very small returns like 1%. Are there any plans on bringing the mechanism online? If there is, there might be some interest in pursuing the same.

@shankarnath 4 ай бұрын

Hello, you'll have to check the digitization bit with your stockbroker

@dr.anishagarwal7499 10 ай бұрын

Awesome 👏 just

@shankarnath 10 ай бұрын

Thanks! Glad you liked it

@JayMehtamehtafashionhouse 6 ай бұрын

Ya but motilal oswal does not allow slbm if portfolio is less than 1.5 crore and I was shocked after hearing this

@shankarnath 6 ай бұрын

Thx for sharing, I didn't know this either. I guess since this is not mainstream no one has automated it with tech. That's probably why they have large tickets. But 1.5 cr is definitely high

@arunpaul2587 6 ай бұрын

Thanks for sharing information about Motilal Oswal.

@raghukoka8106 6 ай бұрын

Nice stuff

@shankarnath 6 ай бұрын

Thanks

@amanjeetsingh9191 Ай бұрын

Can you share practical part । Actual how to done it

@shankarnath Ай бұрын

Hi. Your broker can help you on the same, request you to connect with your relationship manager

@sauravkataruka1 10 ай бұрын

What about the long term / short term holding period and tax applicability for the lender as everytime shares are credited to demat, holding period starts from that date. One may lose long term benefits despite holding the the stock for years if he/she ends up selling it soon after leading it and getting it back?

@shankarnath 10 ай бұрын

This was covered in the section on corporate actions and taxation. Pls watch from 12:58 onwards

@sauravkataruka1 10 ай бұрын

@@shankarnath I saw that. I will watch once again to see if I missed the point. What I am saying is: When I lend my shares it goes out of my demat and comes back later when the contract ends. Suppose, I bought 100 shares of Icici bank on 1st April 2022. I lend these shares from 1st Jan 2023 to 31st March 2023. Get them back in my demat on 1st April 2023 and decide to sell them at profit. Ltcg should apply in this case. But, brokers platform would calculate the taxation based on demat credit / debit date.

@sauravkataruka1 10 ай бұрын

@@shankarnath btw, your research and depth of coverage is really impressive.

@shankarnath 10 ай бұрын

@@sauravkataruka1 When shares are lent out, you are still the owner of the shares ("lent" is not sale). So technically, you bought on 01.04.2022 and sold say, on 01.08.2023 .. then its 16 months which means LTCG applies.