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# Example 1

**Portfolio:** 

<table data-header-hidden><thead><tr><th width="113"></th><th width="156"></th><th width="85"></th><th></th></tr></thead><tbody><tr><td>Product</td><td>Underlying</td><td>Strike</td><td>Quantity</td></tr><tr><td>Call</td><td>WETH/USDC</td><td>2200</td><td>-1</td></tr><tr><td>Call</td><td>WETH/USDC</td><td>2300</td><td>2</td></tr><tr><td>Call</td><td>WETH/USDC</td><td>2400</td><td>-4</td></tr></tbody></table>

1. If WETH → ∞, WETH collateral required 3ETH
2. USDC collateral at specific WETH prices at expiry:

<table data-header-hidden><thead><tr><th width="119"></th><th width="131"></th><th width="77"></th><th width="105"></th><th width="81"></th><th width="83"></th><th width="80"></th><th width="81"></th></tr></thead><tbody><tr><td><br></td><td><br></td><td><br></td><td><br></td><td>ETH Price @ Expiry</td><td>ETH Price @ Expiry</td><td>ETH Price @ Expiry</td><td>ETH Price @ Expiry</td></tr><tr><td>Product</td><td>Underlying</td><td>Strike</td><td>Quantity</td><td>0</td><td>2200</td><td>2300</td><td>2400</td></tr><tr><td>Call</td><td>WETH/USDC</td><td>2200</td><td>-1</td><td>0</td><td>0</td><td>-100</td><td>-200</td></tr><tr><td>Call</td><td>WETH/USDC</td><td>2300</td><td>2</td><td>0</td><td>0</td><td>0</td><td>200</td></tr><tr><td>Call</td><td>WETH/USDC</td><td>2400</td><td>-4</td><td>0</td><td>0</td><td>0</td><td>0</td></tr><tr><td>Collateral Required</td><td></td><td></td><td></td><td>0</td><td>0</td><td>-100</td><td>0</td></tr></tbody></table>

3. Compute 1) – 2):

<table data-header-hidden><thead><tr><th width="234"></th><th width="124"></th><th width="121"></th><th width="128"></th><th width="121"></th></tr></thead><tbody><tr><td><br></td><td>WETH Price @ Expiry</td><td>WETH Price @ Expiry</td><td>WETH Price @ Expiry</td><td>WETH Price @ Expiry</td></tr><tr><td><br></td><td>0</td><td>2200</td><td>2300</td><td>2400</td></tr><tr><td>USDC equiv of 3 ETH</td><td><br></td><td>6600</td><td>6900</td><td>7200</td></tr><tr><td>USDC collateral required</td><td><br></td><td>0</td><td>-100</td><td>0</td></tr><tr><td>Net amount</td><td><br></td><td>6600</td><td>6800</td><td>7200</td></tr></tbody></table>

No USDC collateral required

4. Total collateral required = 3 ETH