EU hedge funds lean on repo for leverage

European Union hedge funds are far more reliant on short-term repo funding than their US counterparts, a report by the European Securities and Markets Authority shows.

Around 60% of total EU hedge fund borrowings have to be repaid within a week and 86% within a month, compared to 50% and 65%, respectively, of US hedge fund borrowings. 

EU funds also rely on the repo market for their cash needs more than their US counterparts. Forty percent of EU fund borrowings are made through reverse repo,

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