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Does the Volatility of the Underlying Asset Affect Margin Requirements?

Yes, the volatility of the underlying asset is a primary factor in determining margin requirements. Higher volatility means there is a greater potential for large price swings and, therefore, greater potential losses over a short period.

Clearing houses and brokers will increase the initial and maintenance margin requirements for highly volatile assets like Bitcoin to ensure they are adequately protected against potential defaults.

Does a Higher Volatility in the Underlying Asset Require a Higher Margin?
Does the Margin Requirement Change Based on the Underlying Crypto’s Volatility?
Does the Initial Margin Requirement Change Based on the Volatility of the Underlying Asset?
How Does Market Confidence Affect Implied Volatility?