US prop traders face 1,117% capital hike on Treasury trades

US Securities and Exchange Commission, Washington, DC

Bernard Goyder
08 Jun 2022

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Proprietary trading firms (PTFs) will need to hold exponentially more capital to conduct spread trades linked to the US Treasuries market if the Securities and Exchange Commission adopts a rule it has proposed, non-bank market-makers are warning.

In a comment letter to the SEC, the Futures Industry Association’s Principal Traders Group (FIA PTG), has quantified the capital impact of routing certain Treasuries trades through a registered dealer platform, rather than the current unregistered

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