Variation margin: Difference between revisions
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* [[Margin]] | * [[Margin]] | ||
* [[Margin call]] | * [[Margin call]] | ||
[[Category:The_business_context]] | |||
[[Category:Identify_and_assess_risks]] | |||
[[Category:Manage_risks]] | |||
[[Category:Risk_frameworks]] | |||
[[Category:Financial_products_and_markets]] | |||
Revision as of 21:07, 2 May 2020
(VM).
1.
In futures markets, a potentially refundable amount payable by a 'losing' market participant, to protect other participants in the market against the risk of a default.
If the market price were subsequently to change in favour of the participant, the variation margin would be refunded.
2.
Similar amounts payable in relation to other derivative instruments.
Variation margin is also sometimes known as 'maintenance margin'.
