The Securities and Exchange Commission (SEC) wants to align the minimum margin required on security futures with other similar financial products. The proposal—which, if the Commodity Futures Trading Commission (CFTC) votes in favour of, would be a joint CFTC-SEC proposal—would set the minimum margin requirement for security futures at 15% of the current market value of each security future.
The SEC and the CFTC have joint rulemaking authority regarding margin requirements for security futures. In 2002, they adopted rules establishing margin requirements for unhedged security futures products at 20%. In light of lower margin requirements that have been established for comparable financial products and the resulting asymmetry, the SEC believes it to be appropriate to re-examine the minimum margin required for security futures.