The Securities and Exchange Commission has approved a proposed rule change submitted by the Fixed Income Clearing Corporation (FICC). This rule introduces a new charge called the Volatility Event Charge to help protect against risks during periods of extreme market volatility, especially around significant economic events. The charge is part of FICC's broader strategy to ensure that it collects enough margin from its members to maintain financial stability and efficiently manage market risks. This measure aims to safeguard securities transactions and enhance margin resilience, reducing the likelihood of member defaults impacting the market.
Simple Explanation
The government approved a new rule for a group that handles buying and selling bonds to add a special fee called the Volatility Event Charge. This fee will help keep everyone's money safe when the stock market gets really bumpy and wild.