Risk Management

Explore the products and services in place to identify, analyze, and limit losses.

Mitigate credit risk

Clearing trades reduces risk. CME Clearing serves as counterparty to every trade, sharing credit risk among clearing members to virtually eliminate it.

Enhance efficiency

Real-time trade confirmations and straight-through processing help accelerate the trade lifecycle and minimize errors.

Know your costs

Margins are calculated upfront, with positions marked to market daily. Clearing also helps reduce potential for uncleared regulatory charges.

Explore how we help mitigate credit risk by having CME Clearing act as the central clearing counterparty to every trade – with safeguards and protocols built into every step of the trading lifecycle.

How we manage risk

Get information on the different tools and resources to help optimize risk management.

GOOD-FAITH DEPOSITS

Performance Bonds/Margins

Get details about performance bonds/margins, including margin requirements, CME Margin Services, and frequently asked questions.

TOOLS & SERVICES

Margin Services

Calculate your margins and portfolio margining savings, effectively mitigate risk, and interact with CME margin models.

RISK MANAGEMENT STANDARDS

Financial Safeguards

Get an overview of the financial safeguards CME Clearing has in place to ensure the safety and soundness of our markets.

The methodology behind margins: SPAN and SPAN 2

The CME Standard Portfolio Analysis of Risk (SPAN) methodology has been an industry standard for margining for decades and is still in use today. To address increasing demands on margin methodology, CME Group has developed and begun implementing SPAN 2, which preserves the risk appetite and key forecasting capabilities of SPAN while incorporating new capabilities.

SPAN

Evaluates overall portfolio risk using a Value at Risk (HVar) framework, by:

  • Calculating the worst possible loss a portfolio may reasonably incur over a specific time period (usu. one trading day)
  • Computing gains/losses the portfolio would incur under different market conditions

SPAN 2

Also uses an HVaR framework to evaluate risk, while allowing for:

  • Granular and dynamic adjustments to margins at a product and portfolio level
  • Enhanced reporting of margining into different risk factors, such as market risk, liquidity and concentration risk

Clearing

CME Clearing serves as the neutral counterparty to every futures, option, and OTC trade, ensuring market integrity and reducing risk. Learn about the integral role we play in the global marketplace.

Market Technology

Explore our comprehensive portfolio of trading applications, infrastructure, global connectivity, and data services needed throughout the trading lifecycle.

Margin Services

Get insight on the institution-grade tools we use to reduce bilateral counterparty credit risk and free up trading capital, optimizing margin efficiency.

Contact an expert

Connect with a team member to learn more about the risk management services described here. 


Phone

+1 312 648 3888

Email

clearing.riskmanagement@cmegroup.com

CME Group is the world’s leading derivatives marketplace. The company is comprised of four Designated Contract Markets (DCMs). 
Further information on each exchange's rules and product listings can be found by clicking on the links to CME, CBOT, NYMEX and COMEX.

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