SEC Extends Period for Review of Proposal on Option Margin Requirements

The SEC extended to March 15, 2024 the period for consideration on FINRA-proposed amendments to margin requirements for certain short options.

As previously covered, the FINRA proposal would create an exception to current margin requirements "applicable to short option positions or warrants on indexes that are offset by positions in an underlying stock basket, non-leveraged index mutual fund, or non-leveraged ETF that is based on the same index option." The relief would be subject to conditions, including that the absolute value of the long position must be:

• at least 100 percent of the short notional on the day the option was entered into; and
• at least 95 percent of such amount at all times the position is open.