You have this almost 900+ list of instruments against which you provide collateral margin after haircut. I had few questions around this -
- How is the haircut decided? What formula do you use to come up with the haircut?
- How often is this list updated? Can it change at any point in time?
- I understand MTM changes to collateral margin with daily price move. But do changes to haircut affect collateral margin even after a particular stock is pledged at a different haircut? In short, if I have pledged a stock at 12.5% haircut, and later for some volatility reason, the stock is updated in your list with haircut of 25%, will my collateral margin decrease to 75% due to this change in haircut?
Thanks in advance