0
$\begingroup$

why this is no PAI (price alignment interest) on a future contact like cleared swaps have? Am I right that you may get interest from your margin account, but you do not need to pay the interest back to your counter party.

Improve this question
$\endgroup$

1 Answer 1

Reset to default
1
$\begingroup$

This blog post might help:

https://theotcspace.com/content/price-alignment-interest-pai#:~:text=PAI%20is%20the%20overnight%20cost,a%20CCP%20such%20as%20SwapClear.

Futures are settled daily, and thus considered "maturued" on each trading day. Hence, no PAI needs to be paid.

Improve this answer
$\endgroup$

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service and acknowledge you have read our privacy policy.

Not the answer you're looking for? Browse other questions tagged or ask your own question.