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New hedging rules will make FX traders put up or shut up - every day

Reuters  |  LONDON 

By Saikat ChatterjeeLONDON (Reuters) - New European Union regulations on foreign exchange trading will make it harder and more expensive to manage currency risk, traders said, especially for large financial counterparties such as hedge funds and insurance companies.The regulations will impose "variation margins" on banks, companies and funds that use currency forwards and other derivatives to hedge exposure to currency swings. That means they will need to put up cash to back their trades every day.Market participants say the rules will make it harder for investors to invest in financial ...

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First Published: Fri, September 15 2017. 12:04 IST