Acceptable collateral

Investors

The Australian Clearing House (ACH) does not directly specify the form of collateral that brokers’ may accept from their clients.  Instead, the ACH requires that its Clearing Participants call cash or collateral from their clients which they consider sufficient to ensure that the Participant is able to satisfy its margin obligations to ACH (refer ACH Clearing Rules Section 14.7.1).

Given that collateral arrangements between a broker and its clients are, subject to the ACH Clearing Rules, a matter for the broker to determine, investors should contact brokers directly for information relating to collateral accepted by any individual broker to cover margin obligations.

In accordance with their own policies, some brokers may pass through collateral lodged with them to ACH (subject to ACH’s acceptable collateral criteria).  In order for your broker to be able to pass through collateral lodged by you to ACH, you are required to sign the Addendum to the Derivatives Client Agreement (DCA).  In this addendum, you acknowledge that you have read and understand certain operating Rules of ACH.  These Rules relate to Cover and Default.

The following refers to the relevant sections of the ACH Clearing Rules that relate to Cover and Default:

ACH Clearing Participants

ACH List of Acceptable Stock Collateral (PDF 218KB).