Okuzeka
Finance & Banking vocabulary · Treasury & Markets

Variation margin

Meaning in finance & banking, with examples

nounAdvanced term

In finance & banking, variation margin means: Collateral or settlement payments reflecting changes in the current value of trading positions.

In Turkish: değişim teminatı

How it is used

Use for valuation changes already measured; distinguish it from the future-exposure buffer of initial margin.

Example sentences

  1. The fund paid variation margin after the swap moved against it.

    The payment reflects the position's current valuation loss.

  2. An intraday variation margin call created an unexpected cash requirement.

    Revaluation can produce immediate funding demands.

Common collocations

  • variation margin call
  • exchange variation margin
  • collateralAn asset, such as property, cash or securities, that a borrower pledges to a lender and that the lender can sell if the loan is not repaid.
  • liquidityHow easily an asset can be turned into cash without losing value, or how much cash and easily sold assets a bank or company has to meet its payments.

More terms: Treasury & Markets

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This page explains English vocabulary for learners. It is not financial advice.