Liquidation Engine

For Elektro’s margined products, the Liquidation engine (ELE) continuously monitors users’ margin balances against their maintenance margin requirements

• If a user’s margin balance falls below its maintenance margin, the ELE will initiate a liquidation

• As liquidations occur when the market has moved against the user, this may involve the ELE having to liquidate an in-the-money option, where there is typically less liquidity in a typical options market

• The Elektro Matching Engine will execute these orders by replicating, for example, in-the-money puts into forwards and out-of-the money calls, thereby creating additional liquidity