Clearing House Advisory - CLEARPORT RAV Limits to Switch to Maintenance-Level Rates - Effective December 3, 2009

When margin rates are published for credit limit evaluation on CME Globex, the “maintenance margin rate” for speculative public customers is used.  But when CME Clearport calculates the risk exposure (the “RAV” amount) of a particular trade, historically it has used the higher “initial margin rate” for “spec” customers.

During the month of December, this business difference will be phased out, and margin rates on CME Clearport will be changed to use the maintenance rate.  This is both for consistency and to ensure that the margin rates used for RAV limit calculations are applicable to the broadest possible range of account types.

Note that initial margin rates for spec customers are typically from 10% to 35% higher than the maintenance rates.  Clearing firms may wish to review overall RAV limits for particular customers in light of this.

For more information, contact CME Clearing’s Risk Department at 312-648-3888 and/or the CME Clearport Facilitation Desk at 212-299-2670 or 800-438-8616.