Can I use the entire margin received after pledging mutual fund units?

No, you cannot use the entire margin amount for trading. You can only use a maximum of 50% of the margin amount. For example, if you pledge Rs 1 lakh worth of mutual funds, you will receive a margin amount after a 10% haircut, i.e., Rs 90,000. Now, if you purchase a scrip for Rs 60,000, only Rs 30,000 can be used from the margin. For the remaining Rs 30,000, you have to bring in cash, even if the collateral is a cash equivalent mutual fund.