Dodd-Frank reporting lets traders prey on hedgers

The US Dodd-Frank Act has foisted transparency on derivatives markets by requiring the public reporting of over-the-counter trades. But some end-users are crying foul, as the new rules cast a spotlight on the once-hidden execution of their hedging programmes

Trading screen showing prices
CFTC's real-time reporting rules: backlash from end-users

It's tough to argue with the virtues of transparency. Since 2008, regulators on both sides of the Atlantic have been trying to push the market for over-the-counter derivatives into the light. Bilateral OTC trades, which were once purely the business of the two counterparties to the deal, must now be reported to centralised trade repositories, which in turn must disseminate information about those trades to the world. If such measures had been in place during the global financial crisis of 2008

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