This page has been archived and commenting is disabled.
CME Hikes Crude Oil Margins For Second Time In A Week
The last time the CME hiked margins across the entire crude oil space was one short week ago, on Tuesday to be specific, when the most important contract, the CL Crude Oil Future, saw its initial margin rise by a little over 4%, from $4070 to $4235.
However, as last week's subsequent events clearly showed, the margin hike was nowhere near enough to bring some stability to the market, when the crude plunge accelerated toward the end of the week, leading to a near-record rout in the product.
Which perhaps is why moments ago the CME once again hiked both initial and maintenance margins across the board for some 151 pages worth of futures contracts, only this time the required cash for initial positions or to maintain existing spec bets for the front month contract was increased four times as much, from $4235 to $4895...
... which means the weekly increase in crude margins is now about 20%, which also means that those specs who were in margined, money-losing positions until today, will have to pony up substantially more cash, or else the crude dump will resume and rather quickly. Unless of course, the recently most margined positions happen to be new shorts, who would now rush to cover.
»
- 8631 reads
- Printer-friendly version
- Send to friend
- advertisements -
Quit tapping me on the shoulder... I'm trying to concentrate.
As an old gf liked to say,
"let go of my ears, I know what I'm doing;)"
I heard that once.
Aren't they supposed to lower margins when the price falls?
Margins go up or down with volatility to keep the losses in the customer accounts, instead of with the exchange or worse, the counter party.
If CDS contracts had some sort of margin or escrow system, mountains of unstable derivatives would go away.
I've traded both. The commodities system is much more rational than anything in stocks. Genuinely risk based, especially in options.
Rush to cover, that sounds exhausting.
Round and round it goes. Where the madness stops, nobody knows.
What the fuck purpose does that serve? Hiking margins to force your hand?
even the real unrigged casinos insist on credit limits when the player is losing hard.
Pleez can I haz informations on wot marjins will be changed and wenz???
P.S. I need the informations BEFOR it happenz.
Normal given the recent volatility.
Some day soon, the Fed either will or won't have the guts to let rates rise. That will determine whether things become a little more rational, or we stay in the Twilight Zone until the crash.
Maybe instead of talking about raising rates they actually will.
Why wait until next year?
Why not right now?
Or maybe it's time for a new Fed Head...
Exactly, we have been "recovering" for 5+ years now and rates just keep going down...
Japan 2.0 (this time with an armed populace). Stupid fucks. End the Fed, claw back the stolen wealth, execute all the "arsonists" involved... ...nothing will change otherwise.
Better yet, end the damn criminal enterprise.
Inaction is proof they don't have a clue, and they hate free markets.
This is perfect. No pentagon head, and the Saudi's are terrified of ISIS.
Since Saudi chooses oil war with the US, Let them deal with their threat on their own, and see what happens.
Use ISIS against the Saudi's, we have them right where they need to be, in terror...
Bring our boys and girls home and let them deal with their own shit for a change, or, kill them all.
or, kill them all.
Priceless.
Hey, if you're going to do something, do it right (I prefer his first option though).
the Saudi is not our friend, in some way, it is our enemy.
So, same as it ever was then...
Oil war is against Iran and Russia supported by USA
Ok ekm, but why kill your own Shale industry??
Nobody is killing it.
Gov will subsidize and maybe even saudis will subsidize
They better hurry up and cut some checks then... http://www.zerohedge.com/news/2014-12-01/shale-bust-arrives-november-permits-new-shale-wells-tumble-15
take that with a grain of salt
Can't buy cheap assets if owner is not distressed.
Obama seems more aligned with Persia than the Sauds.
Yes, but not Pentagon
I figure this was some indian spam job, i found it on stumbleupon, it was retarded, but good for a laugh. ND and Texas now backing ISIS. I figure more Indian spammers should write for bloomberg.
http://itsannounced.blogspot.com/2014/11/isis-aims-for-saudi-arabia-what...
Since the CME's unwritten and constant goal is to crush speculators, the obvious objective of the margin hike is to move the market in the direction desired by their masters.
I'll admit I don't know much about commodities. "Hiking margins"?
In layman's terms, is that like making a bungee cord longer than the distance from the tree limb to the ground?
Here we go again. Shit, just make margins 100% and be done with it. If you buy "it" you must take delivery of "it".
And while you are at it raise rates motherfuckers.
Go ahead, I triple dog dare you.
They can't, it's been proved, the Fed experiment has failed but as per usual, the Fed is now always wrong, but never in doubt, and when in doubt, inflate your way out. It's the simple solution, but the mkt will raise rates and then the Fed will suffer the consequences, derivatives will crash and then the end should be near.
"derivatives will crash and then the end should be near." -- many of us have been saying this since 1999.
And its been happening since 1999. Our perspective is the problem, not our logic. We assume that a collapse must happen according to our schedule and on our terms, and that we'll know it when we see it. Hell, in all likelihood we're probably in the middle of it right now.
OT
Russia running the new pipeline through Turkey, no South Stream.
http://www.reuters.com/article/2014/12/01/us-russia-gas-gazprom-pipeline...
Lets see if the correlation between UST yields and stocks stays broken. It'll be interesting if that has moved on to a correlation between commodities and UST yelds.
I would think this will hurt the shorts, not longs, they already bailed or those who were not deep pocket hedgers.
Yep, they're doing this to smoke the shorts- they got the call from the Big House to pop the price of crude back up- this is the cheap way to do it.
"It seems some folks in the Midwest can't afford to build that pipeline anymore.
Like I said, 'you didn't build it.'
The government is the only one who can save you, you bible toting, gun toting red necks.
If you like your oil transported by rail car, you can keep your oil transport by rail car, Mr. Buffet."
"It seems some folks in the Midwest can't afford to build that pipeline anymore.
Like I said, 'you didn't build it.'
The government is the only one who can save you, you bible toting, gun toting red necks.
If you like your oil transported by rail car, you can keep your oil transport by rail car, Mr. Buffet."
GDP. This is definitely a company that's going down because of the oil prices. Check out their shitty financials! !!!!!!
I'm buying the majors and selling calls against them for long-term income. Rare opportunity in this Fed-controlled world in an attempt to punish Russia, which won't be permanent.