Template:Reg ia capsule: Difference between revisions
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{{imcsdprov|Margin Amount (IA)}} is the portion of one’s [[initial margin]] burden that no-one (except your [[dealer]]) made you pay. As such, you usually transfer {{imcsdprov|Margin Amount (IA)}} directly to the [[swap dealer]], if you are a [[Limey|limey]] (or under the influence of the lime-peddlers), by means of [[title transfer]] and not pledge, and almost certainly your [[dealer]] won’t agree to give ''you'' any {{imcsdrov|Margin Amount (IA)}} for any exposure you feel you have to it. If you are a particularly big or stampy-footed customer, you might persuade your dealer to use the {{imcsdprov|Greater of Margin Flow (IM/IA) Approach}}, in which case you will pay all this extra [[non-regulatory initial margin]] to the {{imcsdprov|Custodian (IM)}} as well the [[regulatory initial margin]] and all of it will be held out of harm’s way, though be careful for what you wish for: your [[dealer]] may charge you bigger spreads as a result because it can’t optimise its funding position on [[initial margin]] you haven’t physically given it. <br> | {{imcsdprov|Margin Amount (IA)}} is the portion of one’s [[initial margin]] burden that no-one (except your [[dealer]]) made you pay. | ||
As such, you usually transfer {{imcsdprov|Margin Amount (IA)}} directly to the [[swap dealer]], if you are a [[Limey|limey]] (or under the influence of the lime-peddlers), by means of [[title transfer]] and not pledge, and almost certainly your [[dealer]] won’t agree to give ''you'' any {{imcsdrov|Margin Amount (IA)}} for any exposure you feel you have to it. If you are a particularly big or stampy-footed customer, you might persuade your dealer to use the {{imcsdprov|Greater of Margin Flow (IM/IA) Approach}}, in which case you will pay all this extra [[non-regulatory initial margin]] to the {{imcsdprov|Custodian (IM)}} as well the [[regulatory initial margin]] and all of it will be held out of harm’s way, though be careful for what you wish for: your [[dealer]] may charge you bigger spreads as a result because it can’t optimise its funding position on [[initial margin]] you haven’t physically given it. <br> | |||
Revision as of 14:55, 20 April 2021
Margin Amount (IA) is the portion of one’s initial margin burden that no-one (except your dealer) made you pay.
As such, you usually transfer Margin Amount (IA) directly to the swap dealer, if you are a limey (or under the influence of the lime-peddlers), by means of title transfer and not pledge, and almost certainly your dealer won’t agree to give you any Template:Imcsdrov for any exposure you feel you have to it. If you are a particularly big or stampy-footed customer, you might persuade your dealer to use the Greater of Margin Flow (IM/IA) Approach, in which case you will pay all this extra non-regulatory initial margin to the Custodian (IM) as well the regulatory initial margin and all of it will be held out of harm’s way, though be careful for what you wish for: your dealer may charge you bigger spreads as a result because it can’t optimise its funding position on initial margin you haven’t physically given it.