CME Group raises margins on Gold futures for the second time in February

UNITED STATES February 29 2016 6:03 PM

CHICAGO (Scrap Register): CME Group has raised margins on gold futures for the second time in February and also raised the margin on platinum as well. The gold margin was also hiked two weeks ago.

The “initial” margin for speculators in the main 100-ounce gold contracts on the Comex division of the New York Mercantile Exchange will rise to $4,950 from $4,675. The “maintenance” margin for existing accounts, as well as all hedge accounts, will increase to $4,500 from $4,250. The margin will also change for smaller-sized gold contracts.

The initial margin for speculators in the main Nymex platinum futures contract will rise to $2,310 from $2,090. The maintenance margin for existing accounts, plus all hedge accounts, will rise to $2,100 from $1,900.

Margins act as collateral for holders of positions in futures market, with traders putting up only a small percentage of the total value of a contract. In a notice late Thursday, CME Group said the increases were “per the normal review of market volatility to ensure adequate collateral coverage.”