Variance Futures provide it's clients1 with the option to trade futures during normal liquid trading hours with margin requirements that may be less than the exchange minimum margin requirement.
Intraday Margin vs. Overnight Margin
Intraday margin = Margin for intraday trading only. This margin is set by Variance Futures and your Futures Commission Merchant.
Overnight margin = Holding positions into the close or for several days at a time and is set by the exchange of the products you are trading, however in such instances Variance Futures and your FCM may require margins greater than exchange minimum margins.
Anytime a customer uses intraday margin and holds a position into the close of a futures market, the account immediately becomes subject to the exchanges overnight margin policies for that product as set by the exchange that product is traded on.
Intraday Margin Cut-Off Time
Margin requirements may revert back to the overnight requirement each day 15 minutes before the close of the normal trading session for a product.
Spread transactions - Margin requirements will always be applied at not less than exchange minimum margins for all spread transactions.
Liquidation
If a customer chooses to hold positions overnight and uses intraday margin to do so, then his positions may be subject to immediate liquidation at, on or after the close of that exchange for the day.
Example: Intraday Margin and Cut-Off Times for CME Traded Equity Indices
1 For qualified accounts.
