easy · FRM Part 1 Financial Markets and Products
What happens if a futures trader fails to meet a margin call by the required deadline?
- The trader's maintenance margin threshold is automatically lowered to match the account balance
- The trader is granted a one-week grace period to locate the necessary additional funds
- The clearinghouse automatically liquidates the trader's position to prevent further losses.
- Any resulting losses are immediately socialized among all other traders on the exchange
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