Variation Margin

CFA Level I
#1

With respect to Futures…I get Initial Margin and Maintenance Margin…wtf is Variation Margin and how does it figure in the futures account (with the clearing house)??

#2

the amount of money you have to deposit after margin call i am not sure if it’s correct

#3

Maintenance margin is a minimum level below which the margin account is not permitted to fall without a margin call. If the value of the margin accoutn falls below the maintenance margin, the trader will receiv a margin call to deposit additional funds. This addition amout is called “variation margin” and must be sufficient to bring the margin account balane back up to the initial margin requirement

#4

good strangedays

#5

strangedays Wrote: ------------------------------------------------------- > Maintenance margin is a minimum level below which > the margin account is not permitted to fall > without a margin call. > If the value of the margin accoutn falls below the > maintenance margin, the trader will receiv a > margin call to deposit additional funds. This > addition amout is called “variation margin” and > must be sufficient to bring the margin account > balane back up to the initial margin requirement Isnt this what happen to Michael Douglas in the movie “A Perfect Murder” – he is CEO of a bond shop and makes a bad bet.

#6

daj224 Wrote: ------------------------------------------------------- > strangedays Wrote: > -------------------------------------------------- > ----- > > Maintenance margin is a minimum level below > which > > the margin account is not permitted to fall > > without a margin call. > > If the value of the margin accoutn falls below > the > > maintenance margin, the trader will receiv a > > margin call to deposit additional funds. This > > addition amout is called “variation margin” and > > must be sufficient to bring the margin account > > balane back up to the initial margin > requirement > > > Isnt this what happen to Michael Douglas in the > movie “A Perfect Murder” – he is CEO of a bond > shop and makes a bad bet. I dont know You should remember at which level was fixed the maintenance margin to know it