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Margin (VIOP Margin)

Margin is the collateral an investor opening a futures or options position must keep in the account to meet their obligations. On VIOP the full contract value is not paid; the investor deposits only the initial margin.
Contents
  1. 1.Key points
  2. 2.Formula / calculation
  3. 3.Worked example
  4. 4.Interpretation
  5. 5.Pitfalls
  6. 6.Official sources
  7. 7.Frequently asked questions

Key Points

  • As central counterparty, Takasbank marks positions to daily settlement prices and credits or debits the resulting profit or loss to the margin account every day.
  • The margin system creates leverage: a small deposit carries a large contract value.
  • if a margin call is not met on time the broker can close the position, and losses can exceed the margin.

Formula / Calculation

Daily profit/loss = (Today’s settlement price − Previous settlement price) × Contract size × Number of contracts (for a long position). If margin falls below the maintenance level, a margin call is issued.

Worked Example

Illustrative

Buy 2 contracts of a hypothetical index future with a multiplier of TRY 10 per point at 10,000 points, with initial margin at 10% of contract value: contract value is 2 × 10 × 10,000 = TRY 200,000 and margin TRY 20,000. If the settlement price falls to 9,800, the daily loss is (9,800 − 10,000) × 10 × 2 = −TRY 4,000, or 20% of the margin.

The figures are hypothetical values chosen to explain the concept; they are not data for any real fund, stock or market.

Interpretation

The margin system creates leverage: a small deposit carries a large contract value. This magnifies both gains and losses relative to the margin; an adverse move can wipe out the entire margin quickly.

Pitfalls

if a margin call is not met on time the broker can close the position, and losses can exceed the margin. Initial margin rates change with market conditions. Leverage should not be used without proper risk management.

Official Sources

Official regulation and sources the definition is based on.

Pages Where This Term Appears

Related Terms

Frequently Asked Questions

Margin is the collateral an investor opening a futures or options position must keep in the account to meet their obligations.

Daily profit/loss = (Today’s settlement price − Previous settlement price) × Contract size × Number of contracts (for a long position). If margin falls below the maintenance level, a margin call is issued.

Prepared by: Yatırımcı.AI Research TeamLast reviewed: Method: MethodologyEditorial policy