Iosco report exaggerates hedge fund leverage, critics claim

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The International Organization of Securities Commissions (Iosco) has come under fire for a new survey that suggests UK hedge funds are, on average, 37 times geared – a figure based on a methodology that overstates derivatives exposure, critics say.

The survey, published on October 21, uses the concept of gross leverage ratio, which is calculated by dividing gross notional exposure by net assets under management. Gross notional exposure is defined as the absolute sum of all long and short position