Is the Clearinghouse Responsible for Calculating the Reference Rate?
Typically, no. While the clearinghouse uses the reference rate for final settlement, the rate itself is usually calculated by an independent, specialized benchmark administrator (like CF Benchmarks for CME contracts).
This separation of duties ensures the independence and integrity of the settlement price calculation from the clearing and risk management functions.
Glossar
Risk Management
Exposure ⎊ Within cryptocurrency derivatives and options trading, exposure represents the aggregate risk arising from positions predicated on anticipated price movements.
Separation of Duties
Control ⎊ ⎊ Separation of Duties within cryptocurrency, options trading, and financial derivatives necessitates a robust framework for mitigating operational and systemic risk, particularly given the immutable nature of blockchain ledgers and the complex interplay of automated trading systems.
Settlement Price
Price ⎊ The settlement price, within cryptocurrency derivatives, options trading, and broader financial derivatives contexts, represents the final agreed-upon value at which a contract expires or is otherwise terminated.
Reference Rate
Benchmark ⎊ Reference Rate is the established, observable interest rate or index used as the basis for calculating floating payments, margin requirements, or funding costs within a financial contract, particularly for derivatives referencing time value.