Document ID: chunk:federal_register_of_legislation:F2024C01109:reg:4:p5
Version: federal_register_of_legislation:F2024C01109
Segment Type: reg
Provision Reference: reg 4 (pt 5/34)
Character Range: 133791–136538

credit rating.
Approved Securities means securities appearing on the list below for which a Trading Participant has, and is able to demonstrate, direct control over and authority to liquidate:
(a)        a letter of credit or guarantee in favour of the Trading Participant issued in documentary form by an Australian ADI or by a foreign bank with at least a short-term investment grade credit rating from an Approved Ratings Agency (provided that the Australian ADI or foreign bank is not the Client);
(b)       a letter of credit or guarantee in favour of the Trading Participant issued by the New South Wales Treasury Corporation, the Queensland Treasury Corporation or the Tasmanian Public Finance Corporation;
(c)        not more than 75% of the market value of shares in one or more of the top 100 Australian companies listed on an Australian stock exchange approved under the Corporations Act, measured by market capitalisation at the time the Cover was lodged;
(d)       not more than 70% of the market value of shares in one or more of the top 10 listed New Zealand companies, measured by market capitalisation at the time the Cover was lodged;
(e)        not more than 90% of the market value of Australian government securities that have a residual maturity of over one year;
(f)        not more than 95% of the market value of Australian government securities that have a residual maturity of under one year;
(g)       for a Trading Participant trading on a foreign financial market, not more than 90% of the market value of foreign government securities that have a residual maturity of under 12 months if:
(i)         the security is approved by that foreign financial market;
(ii)       the security is acceptable as Cover by a futures broker of that country; and
(iii)     the country has a Standard & Poor's long-term and short-term credit rating for sovereigns of AAA and A-1 respectively;
(h)       not more than 95% of the market value of bills of exchange accepted or endorsed by an Australian ADI (provided the Australian ADI is not the Client); and
(i)         not more than 95% of the market value of Negotiable Certificates of Deposit issued by an Australian ADI (provided the Australian ADI is not the Client).
Clearing Facility means, when used in relation to the activities or conduct of a Market, the clearing and settlement facility with which the Market operator has clearing and settlement arrangements for transactions effected through the Market.
Initial Margin means the amount which a Trading Participant requires to be paid by a Client in respect of a Futures Market Contract entered into or proposed to be entered into on behalf of a Client.
Variation Margin means the difference between the value of a Futures