News

Law

Asset Management

Investment Banking

Wealth

Hedge Funds

People

Newsletters

Events

Lists

Concerns over new margin methods as clearing competition hots up

Offsetting investments to reduce margin pledges may appear more efficient but it also creates hidden risks

As new rules heat up competition in the clearing market, many houses are devising ways of making their service more capital-efficient for users.

But clearing experts have warned that the rise of techniques such as portfolio margining, a more efficient method for calculating a firm's collateral or margin obligations, should be treated with care.

WSJ Logo