What Is Cross-Margining and How Does It Affect Initial Margin Requirements? ⎊ Path

What Is Cross-Margining and How Does It Affect Initial Margin Requirements?

Cross-margining is a system that allows a trader to use the excess margin from one account or product to offset the margin requirement for a position in another related account or product. This is possible when the positions are deemed to have offsetting risks.

By netting the risks of correlated positions, cross-margining can significantly reduce the overall initial margin requirement for a diversified portfolio.

How Do Cross-Margining Arrangements Reduce Overall Margin Requirements for Traders?

How Does Portfolio Margining Potentially Increase Capital Efficiency Compared to Standard Margining?

What Is Portfolio Margining and How Does It Differ from Standard Margining?

How Does Portfolio Margining Differ from Standard Margin Requirements?

Does Cross-Margining Increase or Decrease the Overall Systemic Risk for the Clearing House?

Can Cryptocurrency Spot Holdings Be Used in a Cross-Margining System for Futures Contracts?

How Does Cross-Margining Affect a Clearing Member’s Capital Requirements?

How Is Portfolio Margining Different from Simple Cross-Margining?

Glossar

Portfolio Margining

Leverage ⎊ Portfolio margining within cryptocurrency derivatives represents a risk-based approach to collateralization, differing from static mark-to-market methodologies.