
have to check with their trustees about whether they have any addi-
tional restrictions.
By physically transferring the collateral into the name of the clear-
ing member or clearing house, the client loses ‘beneficial ownership’
of the collateral. Therefore, there is a credit risk with the clearing
member or wherever the collateral is held, as it is shown as their
asset and may be seized in the event of a default by the organisation,
even though the client is not involved in the default situation.
Acceptable collateral
Most of the clearing houses for exchanges publish lists of acceptable
collateral. Below is an example list of ...