“The proposed ban on naked short selling sovereign credit default swaps in member states will reduce liquidity in the CDS market, leading to increased volatility of CDS prices, undermine confi dence in member state sovereign bonds, and make it more expensive for member states to fi nance budgets.”

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“The proposed ban on naked short selling sovereign credit default swaps in member states will reduce liquidity in the CDS market, leading to increased volatility of CDS prices, undermine confi dence in member state sovereign bonds, and make it more expensive for member states to fi nance budgets.”

—Andrew Shrimpton, a member in regulatory compliance at Kinetic Partners in London, in response to an E.U. agreement to ban so-called naked credit default swap trading on sovereign debt.

 

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