Unlike regular margin, which calculates margin on the contract level, BIT portfolio margin (“PM”）evaluates the risk on the portfolio level by computing the most likely loss could occur to a portfolio under a series of hypothetical market scenarios. After the PM account is enabled, the client will be able to find the risk parameters published on the ‘Portfolio Margin’ page of BIT and monitor the client's overall margin level.
Compare to the regular margin model, PM model tends to reward hedgers by offering a greater capital efficiency to their well-maintained low-risk portfolios. For speculators who have directional portfolios, however, a lower margin is not always guaranteed with the PM enabled. Please be noted that one’s account will not always be better off with PM enabled. Examples: a long option account might be more likely to trigger liquidation under the certain market conditions with PM enabled compare to the regular margin mode.
To be qualified for a PM account, below are the minimum criterias to be met:
- Cash Balance > 10000 USD
- The PM account holders must be able to demonstrate their experience in trading options and declare their understanding about Portfolio margin.
For those who are interested, please contact vip@bit.com