CL maintenance margin

[upstar]

New to the CL trading,

just wondering why the maintenance margin keeps decreasing further into the future?

http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude_performance_bonds.html

Thanks!

 

[Buy1Sell2]

Why would you be asking this question? Are you trading with just enough capital to cover the margin and seeing an opportunity to increase your holdings? Forget about the margin requirements. You should never be anywhere close to being at maintenance or initial or span margins on any instrument. Too much margin will change the way you feel about a trade and whether or not you will be able to stomach the ups and downs to reap the full benefit of the trade. Get right.

 

[upstar]

I am asking just out of curiosity, shouldn't the maintenance margin stay the same? This is a little counter intuitive, that's why I am curious.

 

[globalarbtrader]

New to the CL trading,

just wondering why the maintenance margin keeps decreasing further into the future?

http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude_performance_bonds.html

Thanks!

I haven't checked this but the obvious reason is that the volatility is probably lower in the future.

 

[Low Salubrity Thug]

Why would you be asking this question?

It's a perfectly valid question.

Are you trading with just enough capital to cover the margin and seeing an opportunity to increase your holdings?

Lots of professional traders only hold the capital necessary to cover margin in their trading accounts. Unlike the piker majority here we don't keep all our liquid wealth in our trading accounts. Why would we?

Forget about the margin requirements. You should never be anywhere close to being at maintenance or initial or span margins on any instrument. Too much margin will change the way you feel about a trade and whether or not you will be able to stomach the ups and downs to reap the full benefit of the trade.

Utter nonsense. Margin requirements play a large part in ensuring capital is deployed in the most efficient manner possible. Understanding them enables a professional to trade their desired size in their desired markets without having capital unnecessarily tied up.

The manner in which you admonished the OP for asking a valid question and then replied in such a condescending way without providing any value to the thread was uncalled for.

Get right.

Please do in future.

 

[Buy1Sell2]

Once (if) you become a successful professional trader, you will understand why I asked my questions. Too much use of margin and thought of windfall profits are the downfall of most under-capitalized traders. I suspect that is the real reason that the OP queried. Get right.

 

[OTM-Options]

Lots of professional traders only hold the capital necessary to cover margin in their trading accounts. Unlike the piker majority here we don't keep all our liquid wealth in our trading accounts. Why would we?

Do you mean like these professionals?

EUR/CHF wipeout/margin call ... negative balance ... what to do?

No pike trading with those guys, they squeeze maximum profit from their trading accounts.

 

[Low Salubrity Thug]

Once (if) you become a successful professional trader, you will understand why I asked my questions. Too much use of margin and thought of windfall profits are the downfall of most under-capitalized traders. I suspect that is the real reason that the OP queried. Get right.

Astonishing arrogance to presume to know so much about others. I have flicked through some of your contributions in other threads which exhibit a similar tone.

 

[Buy1Sell2]

Astonishing .

There's a reason for that.