CME Archives - the patient investor

November 5, 2011

CME Group Clarifies Maintenance Margin Ratios – Exchange to Reduce Initial Margin Ratio to 1.00 – PR Newswire – sacbee.com

CHICAGO, Nov. 5, 2011 — /PRNewswire/ — CME Group today is clarifying its notice to clearing firms regarding margins. In light of the issues customers transferring out of MF Global are facing, while still maintaining appropriate risk management protections for the market, CME Clearing is setting the “initial” margin upcharge to zero. This upcharge is normally applied to customer accounts when they are receiving a margin call.

The intention and effect of these changes are to decrease the size of any margin calls resulting from the bulk transfer of MF Global customers to new clearing members not to increase them.

This is a short term accommodation to maintain market integrity and provide temporary relief to customers whose accounts have been disrupted by this event.

We apologize for any confusion our initial advisory may have created.

via CME Group Clarifies Maintenance Margin Ratios – Exchange to Reduce Initial Margin Ratio to 1.00 – PR Newswire – sacbee.com.

November 5, 2011

Because Of A ZeroHedge Post, Tons Of People Are Worried About A Commodity Market Meltdown On Monday

ZeroHedge has also updated the post, so it seems that everyone is in agreement. Margins aren’t being hiked on everyone, they’re being lowered, most likely so that ex-MF Global customers can transfer trades without having to post a ton of new margin to keep their trades on.

via Because Of A ZeroHedge Post, Tons Of People Are Worried About A Commodity Market Meltdown On Monday.

November 5, 2011

The CME Margin Notice That Has Everyone In a Tizzy | Kid Dynamite’s World

Last night the CME sent out a margin advisory. They do this all the time, changing margin requirements in different products, but this notice was different:

The notice was picked up (and spread, like financial news Herpes) by ZeroHedge, who predicted a plethora of margin calls on Monday, and of course, imminent Financial Armageddon. There is of course an alternative potential explanation……….the initial/maintenance ratios were previously greater than 1.0. They are being LOWERED to 1.0.

via The CME Margin Notice That Has Everyone In a Tizzy | Kid Dynamite’s World.

September 26, 2011

CME Raises Gold, Silver, Copper Margin Requirements – WSJ.com

Exchange operator CME Group Inc. will raise the collateral requirements for trading in gold, copper and silver futures after a volatile week.

Gold margins will be raised by 21%, silver margins by 16%, and copper margins by 18%, effective at the close of trading Monday, CME said in an email after trading closed Friday.

via CME Raises Gold, Silver, Copper Margin Requirements – WSJ.com.

August 25, 2011

And There’s Your Perfectly Leaked Explanation: CME Hikes Gold Margins, Again, This Time By 27% | ZeroHedge

Two weeks after the CME hiked gold margins by 22%, and two days after the Shanghai Gold Exchange sent them higher by 26%, here comes the CME, as we expected, with another 26% gold margin hike. And now we know that this particular margin hike was leaked well in advance, and explains the entire $100 plunge in gold today.

via And There’s Your Perfectly Leaked Explanation: CME Hikes Gold Margins, Again, This Time By 27% | ZeroHedge.