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(Kitco News) - CME Group is lowering margins for palladium futures traded on the New York Mercantile Exchange.

For speculators, the “initial” margin for new positions will decline to $4,400 from the current $5,225. For “maintenance” of current speculative positions, plus all hedge positions, the margin will decline to $4,000 from $4,750.

The rates will be effective after the close of business on Monday, CME Group said in a notice released Thursday night. The changes were part of the “normal review of market volatility to ensure adequate collateral coverage,” according to the notice.

Margins are the amount of money, or collateral, traders must ante up to control a futures contract. They act as protection against default.

CME Group also announced changes in margins for a number of energy contracts, including increases for crude oil and natural gas.

The complete notice can be seen at this link: http://www.cmegroup.com/tools-information/lookups/advisories/clearing/files/Chadv12-280.pdf

By Allen Sykora of Kitco News; asykora@kitco.com

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