Transaction Margins are an element of the clearing guarantee system used to secure cash settlements. They consist of a Delivery Margin, a Historic Margin and a Transaction Limit.
The minimum value of Transaction Margins is determined in accordance with the Detailed Rules of Clearing and Settlement of the Exchange Clearing House.
Transaction Limit
Transaction Limit is the surplus of funds in the transaction margin above the required value of the Delivery Margin and Historic Margin.
The Transaction Limit is divided into:
- Basic Transaction Limit
- Transaction Limit dedicated to the IDM
Basic Transaction Limit defines the maximum value of purchase or sale on spot markets, which have not been covered by the Historic Margin and Transaction Limit dedicated to the IDM. Transaction Limit dedicated to the IDM defines the maximum value of purchase or sale on the Intra-Day Market.
Dedicating a limit to the IDM (XBID).
Sample calculation and update of the Transaction Limit.
Delivery Margin
The purpose of the Delivery Margin is to cover the exposure on account of payments for the settlement of transactions on forward markets. The value of the Delivery Margin is conditional upon the estimated daily liabilities on account of settlement of transactions concluded by the Clearing House Member on forward markets for electricity and gas. The algorithm and the frequency used to determine the value of and the procedure for providing the Delivery Margin are defined in the Detailed Clearing and Settlement Rules of the Exchange Clearing House.
Historical Margin
The purpose of the Historic Margin is to cover the potential exposure of a given Clearing House Member in respect to transactions concluded on Day-Ahead Market instruments, whose code begins with the string of characters “DAM”. The Historic Margin is updated daily and the algorithm for calculating its value, the procedure for providing it and the list of instruments to which it is applied are defined in the Detailed Clearing and Settlement Rules of the Exchange Clearing House.