menu_open Columnists
We use cookies to provide some features and experiences in QOSHE

More information  .  Close

Argentex Got Some Margin Calls

2 0
28.04.2025

One niche financial service is getting rid of margin requirements. There are many financial products that require mark-to-market collateral. You enter into a foreign exchange forward contract in which you agree to pay me 100 euros in three months in exchange for 100 US dollars. If tomorrow the euro appreciates, so it would take $1.10 to buy €1, you will have a mark-to-market loss on this trade: You have agreed to pay me €100 for something that, today, is worth only €90.91.........

© Bloomberg