Manage Transactions When You Use Variation Margin Overrides

This section describes how variation margin override rules affect trade entry. 

Book Trades for Futures and Options on Futures

The Book Trade tool considers the variation margin override rules you set up when you book a futures or an options on futures trade for an entity.

When you use the Book Trade tool in Accounting Center to manually book a trade for a future or options on futures, you initially select the entity and security for which you want to book a trade. The Book Trade tool considers the security's Variation Margin setting in order to display the appropriate panel to open or close the trade. For example, if you are booking an open for a future that uses variation margin, you can select the Future with Variation Margin panel. Otherwise if you are booking an open for a future that does not use variation margin, you can select the Open Future panel instead. 

If you want to book a trade for an entity/processing security type grouping that uses a variation margin override, the transaction should not use variation margin even if the security is set up to use variation margin. If you select a security where the security master record has Variation Margin set to Yes, the Book Trade tool considers whether a variation margin override rule is in effect for the selected entity/security in order to allow you to enter the trade using the appropriate panel. For example, if you are booking an open for a future that uses variation margin, but you are booking the trade to an entity with a variation margin rule in effect for futures, Book Trade tool allows you to use the Open Future panel rather than the Future with Variation Margin panel.

Enter Transactions for Futures and Options on Futures

For futures, options on futures, and cleared swap trades, all transaction panels that reference the security's Variation Margin (tag 4533) setting and Cleared Security (tag 5027) setting consider the variation margin override rules you set up for the entity when you use those transaction panels, so that you use the appropriate panel. This affects open and close transactions, buy, sell, write, conversion, receive, exercise, and assign transactions, for example.

For swaps with multiple legs where there is a variation margin override rule in place for the entity and the contract level security, the transaction panels reflect the variation margin override rule so that the contract and legs do not use variation margin.