In addition to the margin required to cover the open positions, members are required to deposit collateral in favor of a mutual guaranty fund referred as the "Risk Fund". The fund provides an additional safety cushion in the event that collateral deposited by a MAOF Clearing House member does not adequately cover its obligations.
The amount of the risk fund is updated quarterly and the contribution of each member to the fund is updated in accordance with the scope of its derivatives margin requirement during the previous quarter.
The minimum risk fund size shall not be less than NIS 200 million and the minimum share of each MAOF Clearing House member in the Risk Fund shall not be less than NIS 5 million.
Cash Deposit, Government Bonds and T-Bills are allowed as collateral, with the cash
portion included in the risk fund is not less than 25%.
As of the 2nd quarter 2020 the size of the
Risk Fund is NIS 630 million.
More about MAOF Clearing House