CME Group Inc, the world's largest livestock futures market operator, has raised margin rates for live cattle futures for the second week in a row after dramatic swings in the market, an exchange spokesman told Reuters on Thursday.

Late on Wednesday the Chicago Mercantile Exchange raised its live cattle initial margins for speculators by 28.6 percent to $1,980 per contract from $1,540, effective at the close of business on Thursday.

Wednesday's increase boosted the margin to the highest level since $2,200 in September 2014. It was the second-highest margin in the last five years.

The increase came after futures spiked up their 3-cents per lb maximum daily price limit on Tuesday, which was expanded to 4.5 cents the following session. Short covering in anticipation of a seasonal rebound in prices for wholesale beef and slaughter-ready, or cash, cattle sparked the rally.

On Oct. 1, the exchange bumped speculator margins to $1.540 per contract, up 16.7 percent from $1,320, which that went into effect on Oct. 2.

Late last week, live cattle futures tumbled by their expanded 4.5-cent price limit as cash prices continued their seasonal downward spiral amid a glut of heavyweight cattle and competitively priced pork during October Pork Month.

"The recent margin increases are due to increased daily volatility in live cattle per our normal review processes," said Chris Grams, CME senior director of corporate communications.

He pointed out that live cattle options and futures market volatility have increased approximately 40 percent in the past few weeks.

"Margins are not set to dampen or heighten volatility, but rather to provide the clearing house and clearing member firms with additional layers of financial resources to lessen the impact of price swings," said Grams.

Live cattle futures' roller-coaster ride has tested the patience and mettle of investors, often leaving them bewildered while pondering their next move.

Joe Ocrant, president of Chicago-based Oak Investment Group, said he is "mildly long" CME live cattle's February contract which recently slumped more than 25 cents per lb in a short period of time.

"During this time I have bought the market a number of times and taken loses," said Ocrant. He added that he would have gone broke sticking to that buy strategy without taking his losses as the market went against him.

"As they say, 'a broken clock is right twice a day,' but it does not make up for all of your missed appointments in between."