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Risk Management

The OG Risk Management program is established in accordance with regulatory and industry standards. The framework is designed to allow OG to identify, measure, monitor and manage the market, credit, operational, and liquidity risks it faces.

Risk Management Tools and Services

Margin Methodology

Initial Margin

OG uses a scenario-based risk model whereby each instrument is evaluated under a deterministic, predefined set of scenarios involving changes in the underlying prices. The PnL of every position is calculated for each scenario, and these are aggregated across the portfolio. Further to this aggregation, margin requirements are adjusted to account for additional calendar spread risks and in some cases OG may provide cross-commodity offsets for correlated products. OG’s margin parameters are calibrated using a combination of FIltered Historical Simulation (“FHS”) VaR, Parametric VaR, and Historical VaR. This ensures a robust estimation of risk and serves to mitigate model risk by selecting from multiple estimation methods.

OG’s risk model provides for increased margin requirements for large, concentrated portfolios, to ensure margin requirements are commensurate with the size of the exposure. Additionally, OG maintains the ability to require additional margin from Clearing Members to mitigate specific risks not covered by the margin model, as determined by OG.

Back-testing

OG backtests its margin requirements on a daily basis, including both instrument-level and simple strategy portfolios where applicable, as well as Clearing Member portfolios.

Real Time Monitoring

OG monitors Clearing Member portfolios on an ongoing basis throughout the day, taking into account updated prices and positions. OG has a twice-daily settlement cycle, and it maintains the ability to make further margin collections on an ad-hoc basis if OG determines it is necessary.

Stress Testing and Default Resources 

OG runs daily stress testing on all Clearing Member portfolios, using both historical and hypothetical scenarios. OG uses the stress testing results to establish the size of the Guaranty Fund, and ensure it remains sufficient.

OG Risk Waterfall

Default Resource Type

Value

Initial Margin on Deposit

N/A

Clearinghouse Guaranty Fund Contribution

$10,000,000

Clearing Members’ Guaranty Fund Contributions

N/A

Values as of August 26, 2026

In accordance with OG’s rulebook, the following resources are available to OG to manage a default:

  1. Defaulting Clearing Member’s Initial Margin
  2. Defaulting Clearing Member’s Guaranty Fund Contribution
  3. Clearing House’s Guaranty Fund Contribution
  4. Non-Defaulting Clearing Members’ Guaranty Fund Contributions
  5. Further Tools as detailed in the OG Rulebook