Feb. 2, 2024
The OCC should not have the ability to adjust certain parameters for calculating margin requirements during periods of high volatility. It would seem that these adjustments could be made to save an member from being margin called if they could not meet the margin requirements. If they default and great stress is put on other clearing members, then they have not properly accounted for risk and should be penalized instead of waiving/adjusting the requirements. It could lead to market manipulation if these and other members know that they will not be margin called. If the OCC has the ability to change parameters to prevent these events from happening, members will continue to increase risk. The proposal is requesting a change to the Margin Policy when this policy has worked effectively sets well established guide rails for members. If this Margin Policy is to change, it will most likely lower the chance of a member from being margin called and that would lead to others increasing their risk as well. This would decrease market stability instead of the proposed increase in market stability this proposal claims.