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Risk Mitigation

Risk is inherent where events expected or unanticipated may happen and it may have an adverse impact on clearing and settlement of trades. Risk containment measures include monitoring of liquid net worth, collateral deposits, and margin requirements, up dating risk parameters etc. in the system are monitored.

Liquid Assets & Collateral Deposits

Members are required to deposit collaterals in the form of cash, bank guarantees, fixed deposit receipts, G-Secs, approved securities and any other form of collaterals as may be prescribed from time to time by the MCX-SX Clearing Corporation Ltd.

Segregation of member deposits shall be as under:

Cash component: Cash, Bank Guarantee, G-Secs and Fixed Deposit Receipts
Non-Cash Component: All other forms of permitted collateral deposits

Liquid Net-worth

Liquid Net-worth is computed as liquid assets less initial margin and extreme loss margin payable at any point in time. The clearing member shall meet with the liquid net-worth requirements prescribed by the MCX-SX Clearing Corporation Ltd. at all points of time.

Minimum Deposit requirement for Clearing Members shall be as under:

Sr. No.	Category	Minimum Deposit Requirement	Composition of Minimum Deposit Requirement
Sr. No.	Category	Minimum Deposit Requirement	Cash	Other than Cash
1.	Clearing Member’s Liquid Networth	50.00 Lacs	50% (25.00 Lacs)	50% (25.00 Lacs)
2.	Additional deposits for each Trading Member affiliated with the Clearing Member	1.00 Lac	50% (0.5 Lac)	50% (0.5 Lac)

Any failure on the part of a Clearing Member to meet with the minimum deposit requirements at any point of time, is treated as a violation of the Rules, Bye-Laws and Regulations of the MCX-SX Clearing Corporation Ltd.

Open Position Limit

Member Level and Client Level Open Position Limit across all the contracts of the underlying as prescribed by the Reserve Bank of India (RBI)- Securities Exchange Board of India (SEBI) standing Technical Committee are as under:

*Client Level	- 6% of the total open position or 10 million USD, whichever is higher.
Member Level	- 15% of the total open position or 50 million USD, whichever is higher.

Member Level (in case of Bank)- 15% of the total open position or 100 million USD, whichever is higher.

*The client level gross open position would be computed across all members based on PAN.

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