Mon, Mar 2, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: Countdown to EU short selling regulation

Friday, May 25, 2012

This article was authored by Tim Jukes, compliance consultant at The IMS Group (now Cordium).

The European Securities and Markets Authority (ESMA) released a consultation draft on short selling and CDS in January 2012; Jukes discusses the short timetable, the proposed restrictions on using CDS as a hedge and the complexity of reporting requirements.

Many interested parties have criticised the compressed timetable which has allowed for only three weeks consultation with the industry on the detailed aspects of the Regulation contained in ESMA's draft regulatory and implementing technical standards and delegated acts. The timescale also resulted in the absence of the normal call for evidence process and the lack of a cost benefit analysis of the measures. Commentators have noted that such short timeframes could well impede ESMA's aim of producing high quality and credible standards.

Amongst the areas where respondents to the consultations highlighted concerns, the proposed restrictions on using Credit Default Swaps as a hedge feature highly. Under the Regulation, a short sale in sovereign debt is permissible where the transaction serves to hedge a long position in the debt instrument of an issuer, the pricing of which has a 'high correlation' with that of the given sovereign debt. The detailed ESMA proposals, however, introduce n......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Investing - Seth Klarman of Baupost outlines his investment process as major stock market indices are stretched, Myriad hedge fund sold bulk of its Alibaba stake last year[more]

    Seth Klarman of Baupost outlines his investment process as major stock market indices are stretched From Valuewalk.com: As hedge fund manager Seth Klarman, leader of the $28 billion Baupost Group, reviews 2014 performance and considers investors gained near 7 percent on the year, he cons

  2. Adamas Asset Management and Ping An Insurance to co-manage $500m debt fund[more]

    Komfie Manalo, Opalesque Asia: Hong Kong-based Adamas Asset Management and Ping An Insurance Group, one of China’s largest financial institutions, have finalized a memorandum of und

  3. Opalesque Exclusive: dbSelect’s top ten FX strategies average almost 10% in January[more]

    Benedicte Gravrand, Opalesque Geneva: In one of Deutsche Asset & Wealth Management (AWM)’s hedge fund platforms, called dbSelect, a number of FX Strategies did very well in January. dbSelect is a managed investment platform for unf

  4. Opalesque Exclusive: SEC’s Mark J. Flannery warns hedge funds against valuation misconduct[more]

    Komfie Manalo, Opalesque Asia: Securities and Exchange Commission chief economist and director of Division of Economic and Risk Analysis (DERA) Mark J. Flannery has warned of the risks posed by market misconduct, particularly in the true valuation of assets by hedge fund managers. In his

  5. Dymon Asia's $3bn macro hedge fund lost 10.45% in January[more]

    From Reuters.com: Dymon Asia's $3.1 billion macro hedge fund lost 10.45 percent in January, performance data seen by Reuters showed, a month where many peers lost heavily after a surprise rise in the Swiss franc. Singapore-based Dymon, set up by Danny Yong, a former founding partner and chie