The Cherry On Top: CME Lowers Equity Index Margins By Over 20%

Tyler Durden's picture

In a week which has seen the Fed telegraphing further QEasing by its favorite mouthpiece, and the ECB promising, but never delivering, both that the ESM would get a banking license, which prevented the EURUSD from tumbling below 1.20 yesterday yet which has been totally forgotten today, and that we should "beeleeve" Mario Draghi that unlike before he will not let the EUR fail, the cherry on top and the one event which removes any doubt that the coordinated events of this whole have had the sole purposes of masking that US corporate success has finally plateaued and it is 'only downhill from here', comes courtesy of the CME which moments ago cut the margin requirements on the bulk of its equity indices by 20-25%.

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agent default's picture

Oh wow.  The bucketshop is trying to stay relevant. 

Ray1968's picture

Ready for the gold margin hike?

Just saying..... 

You know its coming.

101 years and counting's picture

didnt that mark the top last july/aug?  seriously.

FieldingMellish's picture

Three times. 10 Aug, 24 Aug and 23 Sep. The more they hike the margin, the less effective it is at its intended purpose... kind of like QE.

The Monkey's picture


Hall of horrors! You're fucked!!!

Doña K's picture

And if there is a sudden downward trend.... We will see if everyone's margin is gone and while running for the exits someone has to take the hit. it will be you the little guy.

Or you are in and while you are down a bit, they increase margin in which case you need to unwind your positions or throw more money in the pit. 


The motto is: Preserve your capital. Forget any profits until the game is at least fair and the rules do not change on a daily basis.

flacon's picture

June 1st, 2011:



CME lowers margins on S&P Futures-all in?



Friday, June 17, 2011

CME Group lowers margin requirements for Gold futures



Yup Ray Ray, they will hike margins on AU/AG right after global QE is announced and stocks will soar and the metals will tank, and the spin doctors will be out in force saying how the world economy is saved and there is no need to be in the safety of gold and silver anymore.  Of course, that trend will last about 20 minutes. 

Renewable Life's picture

yep, anything that even smells like it could compete with the fiat currency fantasy, (gold, silver, copper, etc) will get crushed, the the moon!!!

FieldingMellish's picture

Let them eliminate margin for PMs all together. Drive the specs out of the derivative market and into physical where everyone belongs. Honest markets for honest money.

Northeaster's picture

Hopefully people are still reading this thread. You present a great question, and a question I've been asking for weeks that no one on ZH can answer, or even offer insight to:

A delay of TRIPLE margin hikes? The question of course, as I've been thinking, will this result in a massive sell off in paper? Monday, August 6th we'll have our answer or another delay.

Not sure about anyone else, but I'm hoping in sell off, with cash on the sidelines, it's a no-brainer buy (and I am not a metals bug).

veyron's picture

CME has no choice ... they are almost completely irrelevant

DeadFred's picture

Still, they're a business and the leadership has fiduciary responsibilities. Does this seem at all responsible. When the market sits on what many are calling the edge of a decades long support that if it turns south there's huge downside risk and there's lots of resisitance above so limited chance of a big rally, that's when you decide to cut margins so your stock holders are left holding the bag if/when those overleveraged bozos get taken out? Margins are meant to protect the exchange from people who lose more than they have in their accounts. It's a desperation move on the part of the manipulators. They're going all-in on a pair of twos and praying for a streak of luck. If the drought is any indication they shouldn't expect any divine intervention to help them along. The Ponzi is going down.

marz929's picture


LeisureSmith's picture

It's a bird! It's a plane! It's Jon Corzine! Free as a bird, laughing as he swoops down taking dumps on people below. The original Shithawk. This might not come as a surprise, but it was news to me. apparently the douche is pretty tight with placeHolder & co.

HelluvaEngineer's picture

"Screw you guys.  I'm going home."

ReallySparky's picture

Ladies and Gentleman, the casino is open.   All muppets are welcome to place your bets.

ATG's picture

Sold the SPY Aug 133 calls for +50% that got 6 ZH Red Votes last two days,

and still have GM calls in an account up 6.8 times since 2 July 2012, no guarantee for future results, maybe better:

Good luck anonymous Red ZH cluckers who don't add value, but enjoy tearing others down.

(Lots of idle frustration in those Red Clicks.)

Skeptics who know the price of everything and the value of nothing (OW)

We donate to ZH for every ZH subscriber.

Trading well truly is the best revenge.

5 thoughtless red clicks so far:

Guess this market's going higher...;


alien-IQ's picture

how are you making money selling SPY 133 calls when SPY is at 136 today and has not closed below 133 in all of July?

I don't think you're being junked because you're "bullish". I think you are being junked because you seem to be bullshitting.

ATG's picture

AIQ, OO subscribers and people on ZH who followed the trades in real time know there is no bullshitting.

Thinking there is was more a reflection on the junkers than the junkee.

Red junk people were all too willing to render a verdict without material evidence.

Sold the SPY calls to close today after opening them long Wed and Thursday, as posted on ZH in real time, red junked at the time for being contrary to predictable emotional ZH crowd opinion reacting to bad news events.

(One of these days I would like to see a positive post on ZH. I keep looking. Yes, I understand ZH was an antidote to Wall Street bs, but too much antidote can poison too.)

Successful trading requires stoicism, not the antagonistic witticism that masquerades as intelligence too often in the comments.

Still have the GM calls bought and posted on ZH yesterday and today, thank you. They were red junked, so may also be a profitable trade.

Thanks for at least being halfway human AIQ.

If you arte reasonable enough to want the whole truth, read this instead of going to critical mass first like some others herewith:

OO weekly subscriptions have a money back subscription  guarantee and no one has needed their money back yet since OO started on 2 July 2012.

OO donates to ZH for ZH subscribers who join 00, profit and repeat subscribe. ZH does good work getting the news out quickly and intelligently, despite the bearish bias. 

(Past performance is no guarantee of future 00 results, maybe better.)

Pity red junkers cannot conceive of option trading success.


35 years of derivative tax loss carryforwards before wised up with OO...



alien-IQ's picture

I don't mean to harp on this, but...I have to point out that there seems to be a glaring flaw in your response.

If you sold SPY 133 calls on Wed and covered today, you should have taken a pounding NOT a profit since SPY has gone from 133.25 low yesterday to about 136.50 high today.

Also, perhaps it's just semantics but, if you SOLD calls, you would BUY to close your position NOT sell (as you just stated).

I don't begrudge anyone making money in this market. It's no small task. But, there is such a thing as being graceful about it and your original post did not display much grace. I understand that you may have been pissed off at whomever for whatever...but your post threw gas on the fire...not water.

I hope you do well trading man. This shit ain't easy.

ATG's picture

AIQ, harp away, there is no glaring flaw in my response.

Apparently you did not read my posts with adequate comprehension, likely due to all the mindless attack flamers assuming and insinuating claims not in evidence.

Did not post OO sold calls short to open trades.

You or another harranguer hypothecated that and it was picked up and spread by chattering monkey nabobs. Check the posts again and please correct if wrong.

Overnight Options trades only in-the-money opening and closing scaled-in long options, with adequate cash reserves to accumulate and hold for less than week, with enough time to expiration to avoid destructive Theta time decay.

There are no margin or naked collateralized OO trades, only cash trades. The $100 weekly suibscription is guaranteed if the open marlket trrades do not cover the cost. So far they have, and subscriberds have been repeat, with no guarantees for the future.

You and other ZH careful readers just got the charitable benefit of 35 years trading derivatives and options many ways with huge carry-forward losses, teaching a Stanford Course called Options and Other Beasts, over three decades at Merrill Lynch/Stanford Capital, recently publishing subscription guaranteed portfolios three years with over 1000% returns each year and making a presentation to TSAASF to perfect OO: 

If done with the right parameters, without fear or greed, options can have a good limited risk to higher reward ratio.

You are quite right about trading not being a small (or easy) task. Frankie Joe et al had fatal heart attacks trading agaoinst the crowd. 

OO was attacked on other blogs and even booted off for posting real trades in real time that worked well without selectively editing them.

Most people are either envious or skeptical it can be done, perhaps ZH posters who complain about the market as a rigged game because they lost money.

My point in posting was to inspire people that they can profit in these markets, rigged, CME, Madeoff, OMFG, PFG, Snodfart or not. 

If there was a lack of grace, it was attempting to respond rationally to repeated crude misbased neanderthal attacks.

As one of the TD fight club who correctly called out criminal Mad Hedge Fund Trader John Thomas fantasy trades as bogus, he eventually left ZH with his nonsense after somehow getting my email from ZH to subscribe to his overpriced mistakes.

Last time checked, his delusional meglomaniacal market calls and pocket trades, eg long TBT for years are still here to see, a credit to TD and ZH.

Likewise the Chilean Movie Maker Dartmouth Philosopher who pretended to be a Fed expert and repeatedly predicted Latin American hyperinflation around the corner in the USA, instead of defacto debt default asset deflation, despiet AG, BB, CR, HP, LS, 0 and TG calls for green shoots for subprimes since 2008.

We are in the greatest depression that began in the Jubilee Year of 2000, and is still poresenting short-term trading ops.  

If you want to send a mailing address to, can mail you all the OO account trades since 2 July 2012 when OO began publishing.

If you want to provide your email, maybe some OO subscribers would like to comment on their experience with OO, since the detractors here on ZH did not believe me.

At least one of them does read ZH, which triggered donations to ZH for the referral:

As I used to say when I had more time to put out Jubilee Prosperity with the help of Mark J of DNS, who keeps ZH working, this was a Longfellow...



Freebird's picture

Sounds like you're over & out, burnt out. Hang up your boots, get back to nature, screw the missus, hug your kids, check your preps & thanks for your contribution. Cioa ATG

ATG's picture

Thanks Freebird, good ideas after a 15 hour day on OO.

Through communicating with unarmed dangerous people who repeatedly do not care to understand the difference between buying long and selling short options.



Freebird's picture

Easy, don't play their game no more. Did, nicely, but not now - its over.

ATG's picture

Ain't over til it's over and trading well is the best revenge.


Global Hunter's picture

People who get hung up on red arrows are whingers and no debates about that, its a FACT.

I'm not concerned about your trades, glad they worked out for you but there's no need to be a sore winner about it.

The Monkey's picture

Some of the "advertised" trades worked out for them. Those that were significant losers were just flipped post results (i.e., puts turned into calls, etc.)

Definitely a scam artist. Watch out.

ATG's picture

If I did not think you were just someone who dispenses prejudiced opinions without just evidence, I would show you all the trades in the account since 2 July 2012 or ask current repeat OO subscribers who have not needed refunds to straighten you out. Click on ATG to see the posts and then apologize for your rabid comments. 

Who exactly is the scam artist to watch out for TM?..


alien-IQ's picture

Methinks thou dost protest too much.

ATG's picture

Not worth a comment Dead File Dept.

(In the three years on ZH there have a lot of gang rape comments by no-nothings, usually on the wrong side of the market...) 

alien-IQ's picture

wait a minute: You're the one claiming to be making money SELLING IN THE MONEY CALLS as the stock price is RISING and you are calling me a "no-nothing" (which you didn't even have the common sense to spell properly)? really need to learn when to shut the fuck up because with every word you type you are digging yourself deeper and deeper into the hole of zero credibility.

ATG's picture

Did not claim to be SELLING IN THE MONEY CALLS, Holmes Joker.

Your specious claims devalue you.

Reread everything posted and apologize for your twisted comments or will no longer respond to your continued baseless attacks trying to demean honest accomplishments you apparently do not understand.

Then get a life beside ZH Cerberus.

A thousand to one misquotes and red marks to one or two greens do not make you or anyone else stooping right, only in league with the devil...

ATG's picture

No AIQ, I meant no-nothing in your case.

Your language says it all...

ATG's picture

Oy, way to smear GH.

Do you feel better now?

The comments on red arrows were re posting profitable real-time option trades here since 2 July 2012, that were junked by until-now anonymous ZH readers, who seem so blindly pessimistic they cannot apparently conceive of trading success being long equity options.

No one is a sore winner.

17 red arrows say a lot about the states of mind of those who did it anonymously. What exactly did they hope to accomplish byu spreading their animosity?

The trades and links were posted on ZH after years here to benefit more than current repeat subscribers, with donations for ZH subscribers going to ZH...

Global Hunter's picture

No smears, I am actually trying to give you some productive advice, take it or leave it.

ATG's picture

And what exactly is the productive advice GH, that you can call someone a whinger and a sore winner and feel proud of it?... 

The Monkey's picture

Hey asshole. Quit changing your story on your positions. You're a fraud.

ATG's picture

Watch your lying mouth Monkey Butt Troll.

Why don't you take the time to look up the real time posts before rendering an unqualified opinion?

What goes around comes around...

fuu's picture

You've been around long enough to know that you get one for link pimping and 2 for flinching.

ATG's picture

No pimp flinch here, FUU.

Just a lot of hostility from some frustrated ZH posters who have little constructive to say...


alien-IQ's picture

seems like you and robo are the only two dickheads fickle enough to count red arrows.

stop being such a pussy.

ATG's picture

Who's counting now?

More smears lower your IQ alien.

Keep on name calling: that's what people do when they have nothing useful to say...

DeadFred's picture

Not complaining about your trades. If had wanted to wager in the casino I would have gone with a similar trade yesterday. The trend line support was still unbroken and yet another short-covering slime rally was pretty likely. I am saying that you're coming across as a whiny snot-nosed kid which sucks as a business model and super-sucks for fight club. Next time grow a set and go for the SPY 135s and make more money.

ATG's picture

DF, thanks for the comment and falsetto condescension. 

You did not trade and OO subscribers did:

Calling out someone with half a century experience in markets from when silver dollars were a buck is priceless projection and entertaining indignation...