Hedging effects mean popular exchange-traded products vulnerable to big losses if volatility spikes
New derivative structures under consideration but caution is key
Net exposure should be smaller than long exposure, not larger, says academic
Rule changes have forced firms – including DE Shaw – to stop trading some equities and credit default swaps
Liquidity drained from the sovereign CDS market before the ban took hold this morning – and market-makers are still unsure what they can and cannot do
UBS Securities has been fined $8 million by the SEC for inaccurately recording 'locates' information
A recipe for disaster?
Fine from Finra is latest indicator of UBS's control and supervisory issues
The new rules are "another instance of the authorities blaming the wrong people and imposing the wrong policies", says Cass's Ian Marsh
Dealers say volumes have been light as market participants try to work out scope of bans – with confusion arising on index trades and the geographic reach of the rules
Regulators need to protect markets from "rumours and false information" say bans' supporters
Assessing the arguments against shorting
Sovereign debt managers criticise ban on naked credit default swaps
Ban could harm government debt markets, according to UK DMO – dealers say any prohibition would backfire
Murky on transparency
Confusion, then clarity
Exchange-traded funds first appeared 20 years ago as transparent, easy to understand alternatives to actively managed funds. But as they have developed some of this transparency and simplicity has been lost. The first Structured Products ETF survey asks…
The European Union is close to reaching agreement on a new supervisory framework, designed to reduce the room for national discretion. But Germany’s recent short-selling ban shows domestic supervisors are not afraid to go their own way to protect…
Deutsche Bank has listed short-bond ETFs on the London Stock Exchange as an interest rate hedge or for taking directional views on UK and US sovereign debt
Shorting shares and bonds could be restricted or even banned under new EC proposals, but naked credit default swaps are safe for now.
Under pressure from member states, the EC expects to adopt new short-selling rules by September.
With the US set to unveil the largest set of financial regulation reforms of the past 30 years, Lianna Brinded reports from Houston, Texas, on how these changes will effect the energy and commodities industry.