The Multi Commodity Exchange Clearing Corporation Ltd. (MCX), on November 08, 2024, issued a notification regarding the Revision in Threshold Limits for Concentration Margin.
MCXCCL has introduced concentration margin requirements as a risk management measure for commodities. For Non-Agri commodities, concentration margins apply if the commodity's Open Interest (OI) exceeds 5% of the total Exchange OI or meets specific threshold limits in Annexure-1. For Agri commodities, concentration margins are triggered if the OI surpasses these specified thresholds. For new or re-launched commodities, a minimum threshold OI of Rs. 250 crore applies to narrow and sensitive commodities and Rs. 500 crore for broad commodities, effective for one year. Concentration margins are recalculated daily, apply only to open Futures positions, and are blocked from the member's available collateral. Exemptions apply to clients with Hedge Codes, and both client-level and Clearing Member-level margins are computed based on defined slabs. Relevant details on concentration margins will be accessible in members' SFTP download folders.
[Notification No. MCX/MCXCCL/745/2024]
