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Self-Regulatory Organizations; The Options Clearing Corporation; Order Setting Aside Action by Delegated Authority and Approving Proposed Rule Change, as Modified by Partial Amendment No. 1, by The Options Clearing Corporation Concerning Methodology To Allocate Clearing Fund Deposit Requirements Among Its Clearing Members To Better Align the Allocation With the Sizing of the Clearing Fund so Stress Based Risk is Fairly Allotted to Market Participants That Expose OCC to Such Stress Risk
Plain English Summary
The Options Clearing Corporation (OCC) has made changes to how it calculates the amount of money that its clearing members need to deposit for risk management. This update aims to ensure that the costs associated with potential market stress are shared fairly among members based on their risk exposure. This change affects all clearing members of the OCC. Insurance agents should stay informed about these updates as they may impact the financial stability and risk management practices of their clients involved in trading activities.
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borne by individual customers and would first be absorbed by the defaulting customers' net equity and available margin collateral.
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Petitioner also states that agency brokers frequently have access to additional forms of loss protection, including fidelity bonds, <span class="match">insurance</span> coverage, and clearing deposits by introducing brokers.
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See
Petition, at 12-14; Opposition, at 14-17; Schwab II, at 5-6; and LPL Letter, at 3.
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See
Petition, at 12 (“OCC's stress-testing methodology does not account for key structural