CME and CBOT Raise Margin Requirements

The CME (Chicago Mercantile Exchange) and the CBOT (Chicago Board of Trade) have raised the margin requirements for several of their markets. The affected markets include some stock index futures and options markets, and some interest rate futures and options markets. These markets include some of the most popular day trading markets (such as the NQ, ES, and YM). The new margin requirements will take effect at the close of trading today (Tuesday, September 30th), so will be in effect for tomorrow's trading. The new margin requirements are available from the CME and CBOT web sites, and should also be available from your brokerage.

How does this affect your trading?

The increased margin requirements will affect any new trades that are made, and any existing trades that are being held, on any of the affected markets. If you are currently holding any active trades on any of the affected markets you will need to confirm that your account will support the new margin levels. If your account will not support the new margin levels, you will need to deposit additional funds with your brokerage (there may not be time to do this), or you will need to exit some trades to make additional margin available. If your trading account is not in line with the new margin requirements as of the close of trading today, it will most likely be automatically adjusted by your brokerage, which may involve exiting trades that you wanted to keep. In other words, review your account's margin before your brokerage starts making trades for you.

I will post any further updates to the margin requirements (if any) as I receive them.