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Who determines the collateral required?
by rattray 6y ago
Who determines the collateral required?
- bradleybuda 6y agoIt’s federal law, part of the Dodd-Frank reforms in the wake of the 2008 financial crisis. I recommend this: https://twitter.com/kralctrebor/status/1354952686165225478?s=21 https://twitter.com/kralctrebor/status/1354952686165225478?s...
- IG_Semmelweiss 6y agoThe NSCC sets the framework, but it is spelled out in Dodd-Frank that they have to do so by law. There are some other items, but that's the basic idea - full details are here: https://dtcc.com/-/media/Files/Downloads/legal/policy-and-compliance/NSCC_Disclosure_Framework.pdf https://dtcc.com/-/media/Files/Downloads/legal/policy-and-co... If you want to dive further i recommend this thread : https://mobile.twitter.com/KralcTrebor/status/1354952686165225478 https://mobile.twitter.com/KralcTrebor/status/13549526861652...
- mzi 6y agoI only knows how it works in otc derivatives and then the collateral is equal to the cost of taking an offsetting position, and is calculated inter-day. But I would guess it is something similar on the stock market.
- disgrunt 6y agoIn this case, the NSCC, or the NAtional Securities Clearing Corporation.