Variation Margin Role Calculation and Importance

1413 reads · Last updated: January 17, 2026

The variation margin is a variable margin payment made by clearing members, such as a futures broker, to their respective clearing houses based on adverse price movements of the futures contracts these members hold. Variation margin is paid by clearing members on a daily or intraday basis to reduce the exposure created by carrying high risk positions. By demanding variation margin from their members, clearing houses are able to maintain a suitable level of risk which allows for the orderly payment and receipt of funds for all traders using that clearing house.

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