Feb. 1, 2024
Dear Ladies and Gentlememan, I write to you to comment on SR-OCC-2024-001 34-99393 entitled “Proposed Rule Change by The Options Clearing Corporation Concerning Its Process for Adjusting Certain Parameters in Its Proprietary System for Calculating Margin Requirements During Periods When the Products It Clears and the Markets It Serves Experience High Volatility”. I am householed/retail investor and I am concerend by this proposal. The failures that led to the problem of possible cascading defaults are regulatory oversights and lack of implementation of proper failsafes. Margin calls are a needed failsafe and show a problem with the existing regulations and instead of reducing it when the failsafe is close to triggering, the regulations need to be overhauled. If the OCC is at risk because of Clearing members are overleveraged, make sure they are not overleveraged by testing their investment models for market violence and persecute (instead of fine) noncompliance or something like that (They are willfully endangering the financel system for a bigger payout). If you reduce the requirements the will just overleverage again and in a year the same problem still exists, just with a bigger magnitude. Also the waving of margin calls or reducing of margin requirements is unfair for other market participants like retail/household since they dont have that amount of margin or possibility to leverage more money than they have. Thank you for the opportunity to comment on this. Sincerely, A Concerned Retail Investor