Trading

European energy traders face up to 80% spike in margins

Collateral calls are jumping, with more pain set to come

New margin calculations have seen requirements for derivatives traders jump significantly
New margin calculations have seen requirements for derivatives traders jump significantly Photo: Peter Boer/Getty Images

European energy traders could face margin hikes of up to 80% as a new calculation model takes effect.

The risk weighting of European energy derivatives has jumped under the latest version of the Standard Initial Margin Model, which is used to calculate initial margin for uncleared derivatives.

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