Performance Bonds/Margins

Capitalize on the risk management benefits of margins and learn how they work.

Performance bonds, also known as margins, are deposits held at CME Clearing to ensure that clearing members can meet their obligations to their customers and to CME Clearing. Performance bond requirements vary by product and market volatility.

Learn about margins for CME Group markets

What are margins? And what role do they play at CME Group as part of risk management? Deepen your understanding with these resources.

Initial Margin Requirements

There two different kinds of margin that a market participant should be aware of. Initial margin is the up-front payment, a percentage of the trade price, made prior to a market transaction when purchasing on that margin. After the initial margin is met, a market participant is required to keep up maintenance margin.  This is the amount of equity required to retain an open position. If subsequently margin equity falls below maintenance margin, a call must be issued to bring the account up to initial margin.  

Heightened Risk Profile (“HRP”) initial margin requirements for all products are set at 110% of the maintenance margin requirement for a given product. Non-Heightened Risk Profile (“Non-HRP”) initial margin requirements for all products are set at 100% of the maintenance margin requirement for a given product.

The following table¹ depicts the aforementioned logic in practice:

Outright Rates CC RATE TYPE DESCRIPTION ISO CURRENT INITIAL CURRENT MAINTENANCE
CRUDE OIL SPREADS - Outright Rates WCC HRP Mnths 3 - 6 USD 1540 1400
CANADIAN HEAVYCRUDE(NET ENERGY) FUT(WCC) WCC Non-HRP Mnths 3 - 6 USD 1400 1400

The maintenance margin requirement for Canadian Heavy Crude (Net Energy) Futures Months 3-6 is $1,400. The Non-HRP initial margin requirement is $1,400, while the HRP initial margin requirement is $1,540 ($1,400*1.1).

¹ For illustration purposes only

About Performance Bonds/Margins

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