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What Is the Role of Initial Margin in Derivatives Clearing?

Initial margin is collateral collected by the clearing house from its members to cover potential future losses on their positions. It is calculated based on risk models like SPAN or proprietary methods.

This pre-funded amount protects the clearing house and non-defaulting members from a member's failure. It is a key defense layer against default.

What Is the Risk to the Clearing House If a Member Fails to Pay Variation Margin?
What Is the Difference between a Clearing Member and a Non-Clearing Member in a CCP Structure?
What Is the Role of a Default Fund in a CCP Structure?
What Happens during a Clearing Member Default Event at a CCP?