Why Isda ditched ‘off-cycle’ updates for Simm

Ad hoc updates riled industry, while regulators pushed for predictability in model recalibrations

The International Swaps and Derivatives Association announced on September 7 that its standard initial margin model (Simm) will be recalibrated at fixed, semi-annual intervals. The move follows regulatory calls for a more frequent and predictable update schedule and industry gripes about the first ‘off-cycle’ recalibration earlier this year.

Simm, which is widely used to calculate regulatory initial margin for non-cleared derivatives, came under criticism for its performance in 2020. The model

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