Futures and Forwards (3/3): Margining

Futures and Forwards (3/3): Margining

In the final video, Abdulla discusses a prominent characteristic of exchanges in that they use clearing houses to act as a central counterparty for all transactions. A Clearing House guarantees the performance of futures and options contracts traded on its associated exchange. And secondly, to protect itself from the risk of default it operates a margining system.

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