The semi-annual recalibration of the ISDA SIMM model, version 2.8+2506 (reflecting data up to 30 June 2025), has been released and becomes effective on 6 December 2025¹.

This update introduces relatively modest changes overall. We see some of the biggest delta risk weight decreases in energy-sector commodities. Conversely, the most notable increases are in the credit qualifying space, specifically for high-yield and non-rated subsections within the financial and technology sectors. Most other risk weights and correlations across interest rate, commodity, and equity risk classes see only minor adjustments, and all concentration thresholds remain unchanged.

While these specific parameter changes may be small and likely have a minor impact on SIMM calculations, in the contemporary regulation-driven environment, we see a trend where the costs and complexities of managing initial margin are becoming a critical focus for liquidity and funding.

In this landscape, simply calculating the IM number is not optimal for managing margin costs, maintaining control over liquidity buffers and making funding projections. There is significant value in understanding its drivers and anticipating how it changes with time, alterations of the portfolio and under stressed market scenarios. The OSTTRA triCalculate service has a sophisticated suite of tools designed to address these exact challenges.

Stay ahead of SIMM version updates

Clients can anticipate IM impact from a SIMM recalibration. Well before SIMM 2.8+2506 becomes effective, OSTTRA triCalculate enables users to compare their current portfolio’s IM against the new model version.

Understanding daily IM movements

A common challenge we see is understanding why IM moves from one day to another, especially for portfolios dependent on many market factors. We have developed a dedicated attribution view to make this transparent. It allows for a drill down analysis from the top-level product class (e.g., Equity, Rates) to the individual risk factors and trades, as well as quantifying how much of the IM change can be attributed to market data moves versus new and expired trades.

Make informed strategic decisions

Effective IM management is forward-looking. To that end, we provide powerful tools for strategic planning:

• Pre-Deal Checks: How will a new set of trades affect your margin? Our pre-deal check tool quantifies the marginal IM impact before execution. This insight can be crucial in deciding not just whether to trade, but how to trade, potentially aiding in the selection of a counterparty or the structuring of the transaction to be more margin-efficient.
• IM Stress Testing: You can also project your margin exposure into the future. The service supports sophisticated IM stress testing, allowing you to bump market data or apply a theta shift (time decay) to predict future IM requirements under various scenarios.

Calculate the cost of funding

Funding initial margin over time can be a big financial burden and source of uncertainty. As part of our extensive XVA suite, we support MVA (Margin Valuation Adjustment) calculations. MVA quantifies the expected cost of funding initial margin over the lifetime of a portfolio. Clients are interested in MVA because it provides a measure of a major cost component associated with uncollateralised or partially collateralised trades, ensuring that pricing fully reflects the true economic cost of the trade’s full lifecycle.

Don’t wait for 6 December

The ISDA SIMM 2.8+2506 update is just the latest challenge in a complex and evolving margin landscape. With OSTTRA triCalculate, you can move from a reactive to a proactive IM strategy.

Contact us at info@osttra.com to schedule a demo or, if you are an existing client, to run a free impact analysis on your portfolio against the new SIMM 2.8+2506 model.

¹ https://www.isda.org/2025/10/31/isda-publishes-isda-simm-methodology-version-2-8-2506/