Collateral haircut
The difference between the valuation of posted collateral and the amount of funding supported by it, expressed on a specified basis.
Route · 10 · 5 terms
Derivatives
Futures and options: obligations, leverage, margin and expiry.
Path goal: Distinguish rights from obligations and account for collateral risk.
Reading sequence
This editorial sequence preserves the Russian curriculum order and uses the existing translated guides.
Foundation
Core explanations: start here if the topic is new.
Futures and options: obligation, right and leverage risk
The difference between futures and options, collateral and variation margin, buyer and seller loss limits, and hedging limits.
Further connections
Additional concepts and practical connections after the foundation.
Forwards and futures: the terminal difference does not describe the whole cash path
Individual terms, standardization, interim settlements and counterparty risk compared in two explicitly defined models.
Futures basis: why the futures price differs from the spot price
The sign of the basis, carrying costs and the futures curve do not promise a future move in the underlying asset.
Initial margin and variation margin: different monetary roles
An open contract, mark-to-market and account funding explained without assuming that the initial deposit caps the possible loss.
Margin of safety: a discount does not insure against model error
Why the gap between estimated value and price is conditional on the model, not a universal safe-buying percentage.
Option expiry: when the right ends and the money needed to exercise it
Last trading time, exercise style, settlement value and required assets cannot be replaced by one date on a screen.
Option premium: intrinsic value and the price of remaining uncertainty
Why being right about the underlying direction does not guarantee an option profit, and why time value is not a fixed percentage.
Profit margin: separate price, volume, mix and costs
How to explain a change in profit margin through economic drivers rather than confusing revenue growth with improved efficiency.
Repo: two legs, collateral haircut and the need to provide additional resources
Why transferred securities and financing are linked, but a change in collateral value can create an additional cash need.
Secured and subordinated debt: one “bond” label, different waterfalls
Why collateral, seniority and group position must be checked separately, and why collateral does not guarantee full recovery.
Key terms
Futures contract
A standardized contract for future delivery or settlement under specified terms.
Option
A contractual right to take a specified action in relation to an underlying asset on stated terms; the other party’s obligation requires separate assessment.
Option premium
The price paid to acquire an option right; it is not the same as the exercise payment or the seller’s collateral.
Derivative financial instrument
A contract whose value or payments depend on an underlying asset, indicator or event.
Scenario checks
No dedicated calculator is assigned to this path. See the learning calculations section.