Clearing is a process to guarantee and confirm the transactions prior to settlement between the Participants, to establish final positions for settlement. Muqassa clears exchange traded transactions on open offer basis, where Muqassa places itself between the counter parties at the time of matching.
List of Markets and Products Cleared:
Saudi Stock Exchange (Tadawul) exchange traded derivatives market
MT30 Index Futures
Following accounts are used by Muqassa for trade, position, margin and collateral management.
Members House Trade and Position Account Accounts used to trade and keep related position for Member`s own transactions.
House Market Maker Trade and Position Account can also be opened for Members for market making activities.
Client Trade and Position Account (Net/Gross) – Muqassa offers two types of client trade and position accounts. First one is the Net Client Trade and Position Account, where positions taken on the same contract with opposite sides will be closed automatically by Muqassa. The other one is the Gross Client Trade and Position Account, where positions taken on the same contract with opposite sides will be kept in the account until it is closed by the Member.
Member House collateral account: Account used to keep collateral against the margin requirement calculated for Member`s own positions at House -Trade and Position Accounts.
Client Collateral Accounts: Two types of client collateral accounts are offered:
Individual Client Collateral Account: Account that is used to keep collateral of an individual Client. The collateral at this account shall only be used to cover the margin requirement calculated for the positions of the Client. This account could be opened upon the request of the Member.
Omnibus Client Collateral Account: Account that is used to keep collateral of multiple Clients. The collateral at this account shall only be used to cover the margin requirement calculated for the positions of the same group of Clients. This is the standard account opened for each Member.
Give-up is the transfer of a trade or multiple trades from one clearing Member to another clearing member. Take-up is the acceptance of transfer of trades as part of a give-up transfer. Take-up is the acceptance of transfer.
Members can rectify any trade within the days & time restriction set by Muqassa.
Rectify can include changing the account number or splitting quantity into several new trades.
Muqassa calculates daily variation margin for all open positions. Calculation takes place at the end of every business day using the Daily Settlement Price or Final Settlement Price, determined by the Exchange.
Variation margin settlement is conducted on a daily basis through the collateral accounts, i.e. Variation margin is either debited or credited to the collateral accounts directly.
Muqassa is accepting SAR cash as collateral. Collateral should be transferred by the Member to Muqassa`s account at the central bank (SAMA).
Member can withdraw collateral within the timeframes specified. Internal collateral transfer between Member accounts at Muqassa is possible.
Muqassa invests collateral in accordance with the investment policy. Certain portion of the interest received is deposited to member collateral accounts based on the entitlement.
The following table summarizes daily clearing activities for Tadawul derivatives market:
Clearing System Open
Settlement of Previous Day Variation Margin
Intraday Margin Calculation Start
Deadline for Final End of Day Margin Call Cover
Final Intraday Margin Call
End of Day Margin Calculation and End of Day Margin Call Issuance
All Clearing House Reports available
Deposit of Cash collateral
Withdrawal of Cash collateral
Rectify Trade Deadline
Trade date until 16:00
Give-Up Trade; Take-up Trade Deadline