ASC

Australian Options Market (AOM):

Margins & Deposits Lodged by a Writer

No option is registered in the name of a writer unless the Clearing House has been furnished with a deposit by the Writer, or the Clearing House is satisfied that it has security of value at least equal to the deposit for the performance by the Writer of his obligations under the Option.

The amount of deposits required by the Clearing House is fixed from time to time by the Clearing House and the Clearing House is entitled to require in any particular case a larger deposit, or to make the registration of any Option subject to other conditions or to require payment of one or more additional deposits at any time after registration of an Option. Each deposit remains with the Clearing House until the Option against which it stands is closed, fulfilled or liquidated and is independent of any margins payable in accordance with the Rules.

Margins payable to the Clearing House are determined by reference to Official Quotations. If there is an increase in the contingent liability of any registered Option, the Clearing House is entitled to require the Clearing Member to pay sufficient funds by way of margin to fully cover the increased liability. Deposit rates, which are based on the volatility of the underlying security, are normally set at weekly intervals but levied daily.

ASE

SOFFEX:

Clearing members have the obligation to cover margin requirements as determined by SOFFEX. SOFFEX performs the calculation of margin requirements once a day after the post-trading period. Daily margin requirements calculated for the final position of a trading day may be covered with cash, securities collateral and/or guarantees issued by third party banks held in the clearing member's collateral account at SOFFEX. If there is a shortfall of collateral on deposit with SOFFEX at the time the margin requirement is called, the shortfall must be paid to SOFFEX in cash one hour before the next trading period begins.

Margin requirements for principal positions will be calculated separately from margin requirements for agent positions. Principal positions and market making positions of the same exchange member will be combined for margining purposes. The same calculation for margin requirements will be applied for both the principal and agent positions.

Normally, SOFFEX will apply a uniform method of margining for all clearing members of the exchange. However, SOFFEX reserves the right to call for additional margin requirements, including intra-day margins, individually for any clearing member based on its assessment of the risk of the clearing member's position.

Clearing members must calculate margin requirements for its risk assessment of their customers and non-clearing exchange members that would come to at least the same amount had they used SOFFEX's margining method.

At this point in time, SOFFEX applies a traditional "premium plus" margining for all option-positions. For financial futures initial and variation margins are calculated. The margin amounts are determined from time to time by the clearing house. SOFFEX has the right to change the method of calculation at its own discretion to protect the interest of the clearing house.

SOFFEX makes use of its right to debit a clearing member's account with the Swiss National Bank (direct debit procedure).

BDF

Frankfurt Stock Exchange:

Not relevant.

DTB:

Concerning futures contracts, since January 4, 1993 the margin parameters - as to initial margins - set by the DTB are as follows:

- Long-term BUND-Futures:

1.0 points (= DEM 2,500 per long-term BUND-Futures contract)

Futures back month spread rate: DEM 700

Futures spot month spread rate: DEM 1,300

- Mid-term BUND-Futures:

0.7 points (= DEM 1,750 per mid-term BUND-Futures contract)

Futures back month spread rate: DEM 350

Futures spot month spread rate: DEM 550

- DAX-Futures:

110 points (= DEM 11,000 per DAX-Futures contract)

Futures back month spread rate: DEM 750

Futures spot month spread rate: DEM 750

Concerning option contracts the DTB computes the margin requirements using a risk-based net margining method within defined margin categories (margin-class, margin-group).

CFTC

Absent an emergency, margin levels for futures contracts other than stock index contracts generally will be set by the U.S. exchanges without CFTC review. However, the CEA specifically provides the CFTC with the authority to set margins in an emergency. With respect to options, the general practice is that, although the CFTC reviews the methodology for calculation of option margin, the actual margin levels are set by the U.S. exchanges. CFTC rules require the full payment of the option premium by the purchaser.

Recent amendments to the CEA require that futures exchanges file rules setting or changing the levels of margin on stock index futures and options with the Federal Reserve Board. The Federal Reserve Board can request and also direct changes in margin levels appropriate to preserve the financial integrity of the contract market or its clearing system or to prevent systemic risk. The Federal Reserve was authorized to delegate any or all of its authority to the CFTC, and in March 1993 the Federal Reserve delegated the day-to-day authority for stock index futures and options margin to the CFTC. The Federal Reserve concluded that the CFTC was the most appropriate agency to exercise the functions assigned to the Federal Reserve under the CEA amendments, and required the CFTC to report to the Federal Reserve annually on actions it has taken regarding margin levels. The CFTC has been receiving and reviewing margin changes pursuant to this delegated authority.

It should be noted that the futures margining system reflects the special functions of the futures markets, and the fundamental differences between the function of margin in futures and securities transactions. The futures markets are mechanisms for the transfer of risk, and the futures margining system is designed to measure the risk involved in each transaction and establish an appropriate good faith payment based upon market volatility, the type of trading involved in the transaction and the fact that daily or more frequently the gains and losses on each position are transferred. Under this system both sides to a trade, i.e., the long and short, make margin deposits and all daily losses and gains on positions are paid daily, such that, at final settlement, no payment due on any futures contract remains outstanding. In establishing margin requirements, futures exchanges attempt to gauge current market volatility and set margin at a level sufficient to cover most one day price moves based on historical volatility.

In the U.S. futures markets, all gains and losses on positions are settled at least daily and settlement payments are final on Trade Day plus 1 (T+1). Such payments are made in same day good federal funds and are generally paid before the opening of the next day's trading. Exchange-set margin levels are the minimum amount intermediaries may collect and are adjusted frequently to address changing market conditions. Thus, during periods of market stress, such as during the Persian Gulf Crisis, the exchanges may change margin levels frequently and may, as appropriate, require additional margin on an intra-day basis.

Supermargins - Some futures exchanges also have the authority to call for additional margins when market conditions and price fluctuations cause the responsible official to conclude that additional margins are required to maintain an orderly market or to preserve the financial integrity of a specific firm. Further, the exchange may impose higher margins to particular market participants in the event market conditions so warrant. All firms collect gross margin, two clearing houses (CME and the New York Mercantile Exchange ("NYMEX")) collect gross margin, the remainder collect margin on a net basis. Options margins generally are set using a theoretical pricing model, and are applied on a portfolio basis. Option premiums must be paid in full. Generally, stock index margins are set at levels which will cover at least 95% of daily price moves.

CNV

As for the prudential framework, the Comision Nacional de Valores regulation has hedging and liquidity requirements based on delta valuation, which must be satisfied on a daily basis. The brokerage houses that issue covered warrants must be delta neutral at the end of each day.

COB

The commodities market collects margins on a gross basis.

For financial contracts, margins are paid by the clearing members to MATIF SA on a net basis. But when the margins are collected by a non-clearing member these margins have to be paid immediately to a clearing member, on a gross basis.

On the MONEP, deposits are paid by option sellers on a net basis.

On the MATIF, the clearing house fixes price limits. The initial margins (deposits) must permit the cover at least on quote variation, defined as price limit, of the futures contract of the underlying contract in case of a sale of traded options.

 For the main futures products, the current initial margins are: 
 
    Notional Bond Futures contract:
 
   Normal: 15 000 F 
   Straddle:  3 750 F 
   Nearby:  3 000 F
 
    Three-month Pibor futures contract:
 
   Normal: 12 500 F 
   Straddle:  6 250 F
 
    Long term ecu contract:
 
   Normal:  3 000 ecus 
   Straddle :    750 ecus 
   Nearby:  6 000 ecus
 
    CAC40 Index futures contract:
 
   Normal:  30 000 F 
   Straddle:  12 000 F
 
    French Treasury Bond Futures contract:
 
   Normal:  20 000 F 
   Straddle:   5 000 F 
   Nearby:  40 000 F

For traded option contracts on futures (Notional bond, Three month Pibor, Long term ecu and Treasury bond), the initial margin corresponds to the loss of the option seller that would result from the most unfavorable change in the liquidation of its overall net position (futures plus options) in one trading day. This initial margin is revised on a daily basis.

For the MONEP options, the deposit is appreciated through the synthetic position of an investor, on each of the several traded options and is proportional to the risk involved.

The amount of the deposit is calculated by finding the liquidation value of the option in case of the most unfavorable likelihood generated by options valuation model.

Additional variation margins must be paid daily for all open positions:

Each trader's positions are marked-to-market daily on the basis of a daily "clearing price" calculated by the clearing house.

The resulting positive or negative variation margins are credited or debited to traders' accounts on a daily basis, giving rise respectively to cash withdrawals (if desired) or to additional cash payments (which must be met before the next day's business) in order to keep the initial margin intact.

Members of those markets are required to obtain margin funds from their clients in an amount not less than the level set by the exchanges.

For stocks traded on the monthly settlement market (marché à règlement mensuel) the margin is equal to 20% of the position if it is paid in cash or Treasury bonds and 40% otherwise. On the spot market, the customer has to pay 100% of the current market value of the stock, prior to the transaction.

CONSOB

CVMQ

Margin requirements for the Montreal Exchange are found in sections 7201 to 7250, 7305, with specific provisions in sections 11201 to 11250 dealing with exchange traded option contracts, sections 14201 to 14250 dealing with futures contracts and in sections 15061, 15311, 15511 and 15611 dealing with lumber, gold, bankers' acceptance and Government Bond futures.

The most relevant of the margin requirements pertain to securities which are listed or traded over-the-counter, as well as bonds, debentures and T-bills, although there are margin requirements for bank paper (domestic and foreign), repurchase agreements, gold, silver or platinum, unhedged foreign exchange, options, commodities, futures contracts, cash and securities loan transactions, interest rate swaps, underwriting commitments and other transactions. For purposes of this Appendix, only the requirements with respect to listed over-the-counter securities, as well as bonds, debentures and T-bills are summarized.

1. Listed Securities - For securities posted for trading on the Montreal Exchange and securities listed on any recognized exchange in Canada, the United States, the Tokyo Stock Exchange, or the stock list of the Stock Exchange, London, the margin requirements for long positions are (i) 50% for securities selling at $2.00 and over, (ii) 60% for securities selling at $1.75 to $1.99 and (iii) 80% for securities selling at $1.50 to $1.74. Securities selling under $1.50 may not be carried on margin. The margin requirements for short positions are (i) 150% of market for securities selling at $2.00 or more, (ii) $3.00 per share for securities selling between $1.50 and $1.99, (iii) 200% of market for securities selling between $0.25 and $1.49 and (iv) market plus $0.25 per share for securities selling at less than $0.25.

2. Bank Warrants for Government Securities - Warrants issued by Canadian chartered banks which are listed on a recognized stock exchange and which entitle the holder to purchase securities issued by the Government of Canada or a province thereof are required to be carried on a margin which is the greater of:

a) the margin otherwise required under the values listed in paragraph (1) above, according to the market value of the warrant, or

b) in the case of a short position, 100% of the margin required in respect of the security to which the holder of the warrant is entitled on exercise of the warrant; provided that in the case of a long position the amount of margin need not exceed the market value of the warrant.

3. Junior Capital Pool Companies - They may not be margined unless certain conditions are met, namely that (i) the security has been posted for trading for a period of not less than 90 days, and (ii) the shareholders of the Junior Capital Pool Company have approved the major transaction.

4. Unlisted Securities - All securities approved by the Board of Governors of the U.S. Federal Reserve System, and unlisted securities of banks, trusts, insurance companies, mutual funds securities that are qualified by prospectus, listed companies' senior securities, unlisted securities in respect of which application for listing has been approved by the Exchange, and securities which qualify as legal for investment by Canadian life insurance companies, without recourse to the basket clause; may be carried on margin on the same basis as listed securities.

5. Bonds, Debentures, Treasury Bills and Notes - This category is divided up into twelve different groups of bonds according to the type of issuer and the credit status of the bond with margin requirements ranging from 1-10%, depending on the type of issuer (government or corporate) and the maturity of the note. For example, Government of Canada bonds require a margin of 1% (prorated over the number of days in the year) for maturities of less than one year, 1% of market value of the bond for bonds with maturities from 1 to 3 years, 2% of market value for bonds with maturities of 3 to 7 years, 4% of market value for bonds with maturities between 7 to 10 years, and 4% for bonds with maturities over 10 years. Note that there is a margin of 50% of market value for bonds which fall into the non-performing class.

6. Futures Contract - The minimum amount of margin a client must deposit and maintain with a member per futures contract is as follows:

    per North American lumber futures contract:
 
   a) for speculators   $900 U.S.
 
   b) for hedgers    $500 U.S.
 
   c) for spreads    $300 U.S.
 
   d) for intermarket spreads, with 
    lumber futures contract traded 
    on the Chicago Mercantile Ex- 
    change, where both sides of a 
    spread are carried on the books 
    of one member   $300 U.S.
 
    per cash - settled gold futures contract:
 
   a) for speculators   $1,500 U.S.
 
   b) for hedgers    $1,000 U.S.
 
   c) for spreads    $  150 U.S.
 
    per bankers' acceptance futures contract:
 
   a) for speculators   $1,500 CAN
 
   b) for hedgers    $1,000 CAN
 
   c) for spreads:
 
    - with expiration months 
      which are 6 months or 
      less apart    $  375 CAN
 
    - with expiration months 
      which are more than 
      6 months apart   $  625 CAN
 
    per Government of Canada Bond futures contract:
 
   a) for speculators   $1,500 CAN
 
   b) for hedgers    $1,000 CAN
 
   c) for spreads    $  300 CAN
 
   d) spreads 5 years vs 
    10 years    $  725 CAN

MOF

Minimum margin levels are set by the exchange, which shall not be lower than the levels stipulated by an order of the Ministry of Finance. The minimum margin levels can be changed by the exchange according to market conditions. Under this rule, higher margin levels than usual have been currently applied as follows.

Stock Index Futures

Margin for exchange members: 25% of contract value

Margin for customers: 30% of contract value

Stock Index Options

Margin for exchange members: Premium plus 25% of index value of the cash market

Margin for customers: Premium plus 30% of strike price

OSC

Margin requirements and levels are set separately by the Board of Governors of each of the TSE and the TFE. The provisions regarding the TSE are much more extensive than those of the TFE due to the greater number of instruments traded on the TSE. The following is a summary only and does not take into account the effect of the conversion and offset provisions found in the By-laws.

The TFE:

Members are required to obtain margin funds from their clients in an amount not less than the level set by the Exchange while clearing member firms of Trans Canada Options Inc. ("TCO") must deposit acceptable margin funds with TCO. These TCO funds can be in the form of cash, government securities or letters of credit. The TFE initial margin for members may be in cash or treasury bills but the maintenance margin must be in cash.

Margin positions are marked to market daily, and maintenance margin calls are made and must be met daily.

The margin requirements are set out in sections 7.22 through 7.30 of the TFE General By-law and provide that every dealer member shall require each person for whom trades in TFE futures contracts are effected to deposit and maintain a margin of not less than the following:

	Open Futures Contracts Which are Not Spreads		Spreads in the Same Underlying Commodity
Futures Contract	Speculators	Recognized Hedgers	Recognized Speculators	Hedgers
T-Bill contract	$1,250	$1,000	$625	$625
T-Bill contract II	$1,250	$1,000	$625	$625
Long Canada contract	$1,250	$1,000	$625	$625
Long Canada II contract	$1,250	$1,000	$625	$625
TSE 300 Composite Index contract	$1,500	$1,000	$200	$200
U.S. Dollar contract	$ 750	$ 750	$150	$150
TSE Oil and Gas Index contract	$2,500	$1,500	$350	$350

With respect to margins for futures contract options, the By-law requires that all purchases be for cash (premiums paid in full) and that each dealer member require each writer for whom trades in futures contract options are effected, to deposit and maintain a margin of not less than the minimum prescribed under the by-laws, rules or regulations of the Exchange in which the futures contract option is traded or its clearing house.

All purchases of TFE options shall be for cash and any dealer who effects a TFE option transaction or carries an account for a writer of a TFE option must require a minimum margin on a Call carried short on an account of (i) 10% of the market price for silver options and (ii) 4% of the market value of the underlying bonds for bond options. The minimum margin on a Put carried short in any account shall be (i) 10% of the market price, in the case of silver options and (ii) 4% of the market value of underlying bonds, in the case of bond options.

Notwithstanding the above, the minimum amount of margin which must be maintained in an account for a writer of TFE options shall be $250 per TFE option. The rules in section 7.25 By-law also contain provisions with respect to offset and situations where members carry long or short for a client account.

In the case of designated options, all purchases must be for cash and every dealer member must require each writer for whom trades and designated options are effected to provide and maintain a margin of not less than the minimum prescribed under the by-laws, rules or regulations of the Exchange on which the designated option is traded or its clearing house. Section 7.26 of the By-law contains further restrictions on spread margins and omnibus account situations.

The TFE and the TCO also have rules which enable them to increase margins as necessary in Emergency Situations. In addition, the OSC, pursuant to subsection 19(2) of the Commodity Futures Act (Ontario) may, where it appears to be in the public interest, set higher margin levels.

The TSE:

Margin requirements for the TSE are found in sections 16.15 through 16.18 of the TSE's General By-law and are summarized below.

The most relevant of the margin requirements pertain to securities which are listed or traded over the counter, as well as bonds, debentures and T-bills, although there are margin requirements for bank paper (domestic and foreign), repurchase agreements, foreign exchange, floating rate debt and underwriting commitments. For purposes of this Appendix, only the requirements with respect to listed over-the-counter securities, as well as bonds, debentures and T-bills are summarized.

Listed Securities - For securities posted for trading on the Toronto Stock Exchange and securities listed on any recognized exchange in Canada, the United States, the Tokyo Stock Exchange First Section, or the stock list of the Stock Exchange, London, the margin requirements are (i) 50% for securities selling at $2.00 and over, (ii) 60% for securities selling at $1.75 to $1.99 and (iii) 80% for securities selling at $1.50 to $1.74. Securities selling under $1.50 and securities of junior capital pool companies traded on the Alberta Stock Exchange, among others more specifically set out in the By-law, may not be carried on margin. Additional provisions apply to short positions and long positions.

Unlisted American Securities - All securities appearing in the current list of O.T.C. Margin Stocks published by the Board of Governors of the Federal Reserve System, Washington, D.C., are required to be carried on a margin of 50% of market price for long positions where the securities are selling at $2.00 and over. For short positions, the minimum credit balance must be 150% of the market price. For securities selling under $2.00, no margin accounts are allowed for long positions. Short positions on securities selling under $2.00 require a minimum credit balance of 200% of the market price.

Option Eligible Securities - For various securities which are eligible according to the Board of Governors of Trans Canada Options Inc., and which are convertible, the margin is 30% of the market value of the underlying securities. Where the securities are non-convertible, the margin is 30%, rising to 50% where the underlying securities fail to continue to qualify.

Bank Warrants for Government Securities - Warrants issued by Canadian chartered banks which are listed on a recognized stock exchange and which entitle the holder to purchase securities issued by the Government of Canada or a province thereof are required to be carried on a margin which is the greater of:

- the margin otherwise required under the values specified for Listed Securities above, according to the market value of the warrant, or

- in the case of a short position, 100% of the margin required in respect of the security to which the holder of the warrant is entitled on exercise of the warrant; or

- in the case of a long position, 100% of the margin required in respect of a security to which the holder of the warrant is entitled upon exercise of the warrant, but the amount of margin need not exceed the market value of the warrant.

Toronto 35 Index Participation Units - Toronto 35 Index Participation Units ("TIPS"), as defined in subsection 28.01(1) of the By-law require a margin in the amount of

- 30% of the market value of such securities with respect to long positions; and

- a minimum credit balance of 130% of the market value of such securities with respect to short positions.

Bonds, Debentures, Treasury Bills and Notes - This category is divided up into ten different groups of bonds according to the type of issuer and the credit status of the bond with margin requirements ranging from 1-10%, depending on the type of issuer (government or corporate) and the maturity of the note. For example, Government of Canada bonds require a margin of 1% (pro-rated over the number of days in the year) for maturities of less than one year, 1% of market value of the bond for bonds with maturities from 1 to 3 years, 2% of market value for bonds with maturities of 3 to 7 years, 4% of market value for bonds with maturities between 7 to 10 years, and 4% for bonds with maturities over 10 years. Note that there is a margin of 50% of market value for bonds which fall into the non-performing class.

SEC

Under present law, there is federal oversight of margin levels in the stock, options and stock index futures markets (see also CFTC response).

Stock Margin Requirements:

Regulation T - The Federal Reserve Board has promulgated regulations governing margin requirements. Regulation T governs the extension of credit by broker-dealers for the purpose of purchasing or carrying securities. ^/ Essentially, Regulation T requires the maintenance of the following margin for each security position held in a margin account:

Margin equity security, except for an exempted security or a long position in any option: 50% of current market value of the security or the percentage set by the regulatory authority where the trade occurs, whichever is greater.

Exempted security, registered nonconvertible debt security or OTC margin

bond: ^/ the margin required by the creditor in good faith or the percentage set by the regulatory authority where the trade occurs, whichever is greater.

Short sale of nonexempted security: 150% of current market value of the security, or 100% of the current market value if a security is exchangeable or convertible within 90 calendar days without restriction other than the payment of money into the security sold short is held in the account.

Short sale of an exempted security: 100% of current market value of the security plus the margin required by the creditor in good faith.

Nonmargin, nonexempted security or a long position in any option: 100% of current market value (premium in full).

Short put or short call on a security, certificate of deposit, securities index or foreign currency: ^/

- in the case of puts and calls issued by a registered clearing corporation and listed or traded on a registered national securities exchange or a registered securities association, the amount, or other position (except in the case of an option on an equity security), specified by the rules of the registered national securities exchange or the registered securities association authorized to trade the option, provided that all such rules have been approved or amended by the SEC; and

- in the case of all other puts and calls, the amount, or other position (except in the case of an option on an equity security), specified by the maintenance rules of the creditor's self-regulatory organization.

Regulation U sets margin requirements for certain extensions of credit by banks. Regulation U generally sets the maximum loan value of collateral securing a loan only when the loan is for the purpose of purchasing "margin stock" and the collateral consists of "margin stock."

Exchange Regulation - Exchanges are free to implement more stringent margin requirements. The NYSE, NASD, the AMEX, the CBOE and the PSE have the following basic margin requirements:

Initial margin: the greater of:

the amount specified by Regulation T;

the amount required to be maintained in customer margin accounts; or

equity of at least $2,000 except that cash need not be deposited in excess of the cost of any security purchased (this equity and cost of purchase provision does not apply to "when distributed" securities in a cash account).

Maintenance Margin:

25% of the current market value of all securities "long" in the account; plus

$2.50 per share or 100% of the current market value, whichever amount is greater, or each stock "short" in the account selling at less than $5.00 per share; plus

$5.00 per share or 30% of the current market value, whichever amount is greater, or each stock "short" in the account selling at $5.00 per share or above; plus

5% of the principal amount or 30% of the current market value, whichever amount is greater, of each bond "short" in the account.

The NYSE, AMEX and NASD have additional requirements for securities listed on the Emerging Company Marketplace of the AMEX.

Options Margin Requirements:

The authority to review margins for options was delegated by the Federal Reserve Board to the SEC in 1983. ^/

Presently, the margin requirements for options are as follows:

Long Options Positions - The margin requirement for all long options positions, regardless of the underlying instrument, is 100% of the option premium.

Equity and Narrow-Based Index Options - The margin requirement is 100% of the option premium plus 20% of the underlying product value, less any out-of-the-money amount, with a minimum of premium plus 10% of the underlying product value.

Broad-Based Index Options - The margin requirement is 100% of the option premium plus 15% of the underlying aggregate index value, less any out-of-the-money amount, with a minimum requirement of the option premium plus 10% of the underlying index value.

Foreign Currency Options - The margin requirement for all foreign currency options is 100% of the option premium plus 4% of the value of the underlying instrument, less any out-of-the-money amount, with a minimum of premium plus 3/4%.

Foreign Warrants - Foreign stock index and foreign currency warrants presently are margined like stock at 50% of the underlying value on the long side and 150% of the underlying value on the short side.

SFC

The margin setting function is the responsibility of the Boards of HKFE and HKFE Clearing Corporation Limited ("HKCC"), the wholly owned clearing house of HKFE. The HKFE Board is responsible for setting client margin and the HKCC Board is responsible for setting clearing house margin. The members collect client margin and pay clearing house margin to HKCC as required.

The methodology utilized in setting the basic levels for client and clearing house margins must be agreed to by the SFC. In addition, a determination must be made that the levels established are adequate to cover the risk exposure under normal market conditions taking into account historical volatility data. The Boards of HKFE and of HKCC may periodically revise the minimum margin requirements according to the level of the Hang Seng Index and other market conditions but in any event, the minimum margin may not be set below the basic level. Any changes to the agreed methodology and levels require prior approval of the SFC.

SIB

The London Clearing House has discretion to set margin requirements with respect to contracts it clears on behalf of clearing members of the London International Financial Futures Exchange ("LIFFE") and other exchanges for which it acts as clearing house. Changes in margin will be made in consultation with LIFFE and other exchanges, as appropriate. Margin may be loaned by an intermediary firm.

Certain of the U.K. exchanges permit the deferred payment of the options premium.