Imposition of Additional Margin in Silver (all variants)

Description

ICCL imposes 2% additional margin on Silver near month futures contracts across all variants effective October 17, 2025.

Summary

Indian Clearing Corporation Limited (ICCL) has announced the imposition of an additional margin of 2% on Silver near month futures contracts across all variants. This measure follows a periodic review of risk management practices and aims to mitigate systemic risk in the commodity derivatives segment. The change applies to SILVER, SILVERM, and SILVERKG contracts and will be effective from the beginning of day on Friday, October 17, 2025.

Key Points

• Additional margin of 2% levied on Silver near month futures contracts (all variants)
• Applies to three contract types: SILVER (expiry Nov 5, 2025), SILVERM (expiry Oct 31, 2025), and SILVERKG (expiry Oct 31, 2025)
• Measure implemented following periodic review of risk management measures
• Objective is to mitigate systemic risk in commodity derivatives trading
• Notice issued by Chief Risk Officer – Risk Management, ICCL

Regulatory Changes

ICCL has updated margin requirements for silver futures contracts under its risk management framework. The additional margin is imposed in accordance with the Rules, Bye-laws, and Regulations of the Indian Clearing Corporation Limited. This represents a temporary enhancement to standard margin requirements for near-month silver contracts.

Affected Contracts:

Compliance Requirements

• All clearing members and participants must ensure adequate margin funds are available to meet the enhanced 2% additional margin requirement
• Members should adjust their risk management and capital allocation systems to account for the increased margin from October 17, 2025
• Participants trading in silver futures must factor in the additional margin when calculating position limits and capital requirements
• Members are advised to inform their clients trading in these contracts about the enhanced margin requirements

Important Dates

• Notice Date: October 16, 2025
• Effective Date: October 17, 2025 (Begin of Day)
• Contract Expiries: October 31, 2025 (SILVERM, SILVERKG) and November 5, 2025 (SILVER)

Impact Assessment

Market Impact: The 2% additional margin on silver futures will increase the capital requirements for traders holding positions in near-month silver contracts. This may lead to reduced open interest or position adjustments as traders manage their capital allocation.

Operational Impact: Clearing members and brokers will need to collect additional margin from clients and ensure compliance with the enhanced requirements. Trading firms may need to adjust their risk parameters and position sizing for silver futures.

Risk Mitigation: The measure is designed to enhance market stability and reduce systemic risk during the expiry period of near-month contracts, when volatility and delivery-related risks may be elevated.

Trader Considerations: Traders with existing positions in the affected contracts should ensure sufficient margin availability. Those planning new positions should factor in the higher margin requirements when assessing trade viability and position sizing.

Impact Justification

Additional 2% margin on silver futures affects liquidity and capital requirements for commodity traders but is limited to near-month contracts and follows periodic risk review