US prop traders face 1,117% capital hike on Treasury trades
Responses to SEC plan show PTFs’ alarm over threshold to register as Treasury dealers
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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