German short sell ban snares long euro FX derivatives
Long euro derivatives positions caught up in proposed legislation, while doubts remain over the exemption of market-makers
The short selling legislation proposed by the German finance ministry on May 25 will ban market participants entering into long euro positions using currency derivatives unless the trade acts as a hedge.
The legislation, distributed for comment to market participants this week, will enshrine into law last week's temporary short selling ban announced by the German securities regulator, Bundesanstalt für Finanzdienstleistungsaufsicht (Bafin), plus a raft of expansions including the prohibition of
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