The Multi Commodity Exchange Clearing Corporation Limited (MCXCCL) on February 10, 2025, issued a circular regarding the Alternate Risk Management Framework Applicable in case of Near Zero and Negative Prices.
The following has been stated: -
•MCXCCL has introduced the Alternate Risk Management Framework (ARMF) for commodities/indices like Crude Oil and Natural Gas, which are susceptible to near zero/negative prices.
•The ARMF will be triggered based on price drops, with threshold prices set for March 2025. Additional margins will be applied based on price movements, and spread margin benefits will be withdrawn.
•The new framework and margin requirements are applicable for March 2025.
[MCXCCL Circular No. MCXCCL/RISK/027/2025]
