Take advantage of the portfolio-based margin model with risk netting benefits across product types and positions

The portfolio-based margin (PBM) model is an alternative to the standard margin model offered by Saxo.

Instead of applying a predefined margin requirement to each position or strategy, the portfolio-based model calculates the overall risk level of a portfolio based on individual risk factors. The model then applies a margin requirement to the total exposure in any given underlying asset.

How do I enable portfolio-based margin?

Instrument types covered:

  • Stocks
  • Stock options
  • CFDs
  • Futures
  • Futures options
  • Index options
  • Graph1

    Standard margin model

    This model recognises a set number of simple strategies combining up to two different positions in any given underlying asset. Complex combinations of positions across multiple asset classes and option legs are not recognised and do not receive netting benefits.

  • Graph2

    Portfolio-based margin model

    This model calculates risk scenarios on the combined exposure to any given underlying risk factor. It then applies margin requirements based on the overall exposure in any given underlying asset.

Who will benefit from portfolio-based margin?

Who will benefit from portfolio-based margin?

As a client, you might benefit from using the portfolio-based margin (PBM) model if you:

  • Combine many different positions through a large spectrum of instrument types;

  • Run option strategies that are not currently recognised by the standard margin model;

  • Trade multileg option strategies, such as butterflies and condors;

  • Trade CFDs combined with options in the same underlying risk factor;

  • Trade calendar spreads on index options and CFDs to achieve netting and margin reductions;
  • Have a minimum account balance of 100'000 CHF.

How does portfolio-based margin work?

How does portfolio-based margin work?

The model creates a link between instruments based on the same underlying asset or “risk factor” (e.g. equity instruments such as Tesla, the S&P500 index or ETFs). It recognises related underlying risk factors across instrument types and calculates the margin requirement by stressing all the positions in a risk factor and estimating the greatest possible loss on the combined exposure.

What are the risks of the portfolio-based margin model?

What are the risks of the portfolio-based margin model?

Please be aware that the portfolio-based margin model entails certain risks. Enabling it on your account may:

  • Offer higher leverage than the standard margin model, meaning losses may be amplified;

  • Increase fluctuations of margin utilisation due to market conditions;

  • Affect the stop-out method on the account.

How do I enable portfolio-based margin?

If you are a EU or EEA resident you will need to firstly obtain elective professional status. Click here to learn more.

Saxo Bank (Schweiz) AG
The Circle 38
CH-8058
Zürich-Flughafen
Switzerland

Contact Saxo

Select region

Switzerland
Switzerland

All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.