Collateral is still treated as a post-trade operational detail.
Margin is managed after execution. Liquidity impacts are assumed to be incidental.
They aren’t.
This CIO brief explains why collateral has become a structural use of capital in modern derivatives portfolios, and why post-crisis margining now shapes liquidity, flexibility, and realised performance.
It outlines where collateral frameworks work as intended, where margin behaviour introduces hidden capital and liquidity drag, and why stress exposes weaknesses that remain invisible in calm markets.
The focus is not on tools or implementation, but on structure: how derivatives design, margin mechanics, liquidity, and governance interact over time.
Read the CIO brief
Collateral Drag – Capital, Liquidity and Derivatives