Help & FAQs

If you only buy Options, there would be no margin obligations. It is when you write Options that require non-specific or cash cover, that margin obligations may occur.

Margins are designed to protect the financial security of the market. If you write an Options contract, you have a potential obligation to the market because the taker of the Option may exercise their position. A margin is an amount that is calculated by ASX Clear as necessary to ensure that you can meet that obligation of your entire Options portfolio on that trading day. A broker may apply additional margin requirements on top of the ASX Clear Margin Calculation, or perform its own client obligation calculation to ensure it maintains sufficient collateral from its client to satisfy its own risk appetite.

Margin obligations are generally recalculated daily, but in extreme market events, they may be calculated more than once a day to ensure an adequate level of margin cover is maintained. This means that you may have to provide more collateral or pay more to meet your margin obligation if the market moves against you. If the market moves in your favour, your margin obligation may fall.

Below are some scenarios that may increase your margin obligations:

• The market moves against you relative to your position/portfolio, thus increasing your potential obligation under the options contract/s.
• ASX Clear increases the margin requirement on your positions, or, alternatively reduces the collateral value allowed on your shares lodged as cover.

CommSec’s Options margin obligation is the sum of the amounts that each of ASX Clear and CommSec separately calculate as necessary to ensure that you can meet your obligations to the market.

CommSec will generally require you to provide an additional amount of margin in addition to the ASX Clear Margin (CommSec Margin). For example, where CommSec considers that the existing margin is insufficient to cover the risk of your open position and having regard to market volatility.

CommSec may require a client who has written Options to provide additional cash or stock as collateral for their open positions, which is referred as Options margin call. Failure to meet a margin call may result in CommSec closing down your options positions without further reference to you.

You can view the total margin required on your Options portfolio on your Position and Financial Statements which are sent to you daily while you have an open position, or from the CommSec website and take action to ensure your margin obligations are met as required. From time to time, you may also receive a phone call from the CommSec Options Desk to notify you regarding the margin obligations.

In general, CommSec will use eligible ASX-traded securities from your portfolio as collateral to provide security for your margin obligations. It is important to note that ASX Clear will apply a percentage discount (haircut) to the valuation of the securities held as collateral. In the event that all your eligible securities are lodged and your margin obligations exceed the total collateral valuation, then cash will be debited from your nominated bank account for your margin obligations.

If you incur a margin obligation, you are required to provide cash or ASX Clear Acceptable Collateral to CommSec by 2pm on the same trading day.

Please note: Once securities are lodged as collateral to cover margin requirements, they are unavailable for further trading through the online trading facility. Any collateral lodged can be released by calling CommSec Options Desk. Alternatively, log into CommSec and navigate to Portfolio > Accounts (Select Options account) > Transfer Shares (under Lodged Collateral) and complete the Recall Unutilised Shares request.

For more information, please call the CommSec Options Desk on 1800 245 698 (8am to 5:30pm, Monday to Friday, Sydney time).