Asian dealers may be more exposed than US in AI selloff scenario
Prime brokers face regional counterparty risk from huge flows in leveraged ETFs, say risk managers
Growing leverage, retail investor herding and concentrated stock indexes all point to greater risks for equity market counterparties in Asia than in the US if sentiment turns against artificial intelligence, risk managers are warning.
“The writing is on the wall – when this market corrects, ground zero is going to be right here in Asia,” says an Asia-Pacific head of market risk at a global bank.
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