FACTBOX-Gold margin changes by CME since 2009

Fri Sep 23, 2011 10:46pm GMT
 

Sept 23 (Reuters) - The CME Group (CME.O: Quote), the world's largest commodities
exchange, raised its margin requirement on trading 100-ounce gold futures
<0#GC:> by 21.4 percent, the third rise since July.
    Coupled with the two previous hikes, both in August, margins have risen by
$5,400 -- nearly 90 percent.
    The raise in margins came after gold slumped more than 6 percent at one
point, registering its third-sharpest daily loss in the past 20 years, its
biggest slide since the financial crisis in 2008.
    Gold fell more than $100 on Friday as a slide turned into a free fall, with
weeks of volatility, renewed strength in the dollar and talk of hedge fund
liquidation wrecking its safe-haven status.[ID:nL5E7KN2YZ]
    U.S. gold futures' benchmark December contract on COMEX GCZ1 settled down
6 percent, or more than $101, at under $1,640 an ounce.
    Following are some details of the margin increase:
    * CME hiked initial margins for speculators to $11,475 per contract from
$9,450 effective Sept. 26. [ID:nS1E78M1YA]
    * Margins are deposits paid by investors in futures markets, where full
payment is made when contracts mature, to an exchange or clearing house to
cover the risk of default by that investor and typically are based on the
largest most-likely daily market move.
    * Exchanges typically raise margins to mitigate risks as price volatility
in the market increases.
    * However, margins can also be used as a tool to curb speculative trading
activity, particularly "hot money," by reducing the number of positions a party
can hold by leveraging a particular amount of money.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
 Graphic - Sharp gold correction: link.reuters.com/tuz83s
 Graphic - Gold volatility:       link.reuters.com/myz83s
 Q&A - End of the road for the gold rush? [ID:nS1E78L0U9]
 CME hike announcement:r.reuters.com/jeb93s
 Factbox-iShares silver, SPDR Gold holdings: [ID:nL3E7KN01X]
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
    Following are the percentage changes in the Comex 100 Gold Futures <0#GC:>
initial and maintenance margins since 2009  (in U.S. dollars per contract)
EFFECTIVE DATE   MARGINS FOR      INITIAL    MAINTENANCE   PCTCHANGE
Sep 26, 2011     Spec...Tier 1   11,475.00   8,500.00      +21.4
Aug 25, 2011     Spec...Tier 1    9,450.00   7,000.00      +27.3
Aug 11, 2011     Spec...Tier 1    7,425.00   5,500.00      +22.2
Jun 20, 2011     Spec...Tier 1    6,075.00   4,500.00      -10.0
Jan 21, 2011     Spec...Tier 1    6,751.35   5,001.00      +11.1
Nov 16, 2010     Spec...Tier 1    6,075.00   4,500.00      +05.9
Apr 30, 2010     Spec...Tier 1    5,738.85   4,251.00      -14.9
Mar 02, 2010     Spec...Tier 1    6,747.30   4,998.00       --
Feb 12, 2010     Spec...          6,747.30   4,998.00      +24.9
Dec 15, 2009     Spec...          5,402.70   4,002.00      +20.1
Aug 21, 2009     Spec...          4,499.55   3,333.00      -16.7
Jan 22, 2009     Spec...          5,398.65   3,999.00      -07.0
Jan 08, 2009     Spec...          5,807.70   4,302.00       -- 
(Reporting by Soma Das in Bangalore; Editing by Bob Burgdorfer)
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