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5550. Long qualifying basket of index securities – Short index participation units – Commitment to purchase index participation units 

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Series 5000: Dealer Member Margin Rules
    Rule

    1. Where a Dealer Member inventory account contains the following combination:

       

      Long position

       

      Short position

       

      Commitment

      (i)

      qualifying basket of index securities

      and

      index participation units based on the same index

      and

      commitment to purchase index participation units pursuant to an underwriting agreement

      and equivalent quantities of each position in the combination are held, the minimum margin required for the combination is calculated in accordance with subsection 5550(2).

    2. No margin is required provided the long qualifying basket of index securities:

      1. is of size sufficient to comprise a basket of securities or multiple thereof required to obtain the participation units,

      2. and

      3. does not exceed the Dealer Member’s commitment to purchase the participation units.

    Guidance/Notices

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    History

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    Disciplinary History
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      Jump to another section in Rule 5500
      5501. Introduction
      5510. Underwriting commitment amount
      5520. Margin requirements for underwriting commitments where a new issue letter has not been obtained
      5521. Margin requirements for underwriting commitments where a new issue letter has been obtained
      5522. Margin requirements for underwriting commitments where expressions of interest from exempt purchasers have been affirmed
      5523. Alternative approach to margining of private placements of restricted equity securities during the distribution period
      5524. Margin requirements for a standby commitment to purchase securities under a rights offering
      5530. New issue letter
      5540. Individual underwriting concentration charge
      5541. Overall underwriting concentration charge
      5551. Long qualifying basket of index securities – Short index participation unit call options – Commitment to purchase index participation units
      5552. Long qualifying basket of index securities – Long index participation unit put options – Commitment to purchase index participation units
      5560. Margin for short positions
      5561. Margin for hedged positions
      5562. Margin for long positions

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