mechtraderpro
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Just found this article...may be a lot more changes on the way as well as this one !!!
Crackdown on 'secretive' CFDs by FSA
Daily Mail
24 October 2008
The strict stance applies to contracts for difference (CFDs) used by speculators to build cut price stakes in firms. Investors using them currently do not have to say how many they own.
But the FSA wants this to change and is planning to make investors disclose holdings of over 3% in any one company.
This will come as a blow to hedge funds, which have been known to use CFDs to build sizeable stakes in companies they wish to influence.
The FSA said the final draft of the rules on CFDs, under which one party agrees to pay another the difference between the current and future price of a share, would be published in February next year and come into force that September.
FSA Director of Markets Alexander Justham said: 'Our goal is to provide an effective and proportionate disclosure regime that works for all involved, and sustains market confidence and efficiency.'
CfDs - which are bets on changes in share prices taken with spreadbetting firms - are widely used by some traders because, up until now, it has helped them hide stakebuilding in companies. Several takeover bids have been launched on secret CfD stakes.
Today's ruling follows eight months of consultation with market participants and represents something of a compromise by the regulator.
But the move was welcomed by the Association of Investment Companies, whose director general Daniel Godfrey said: 'These undisclosed interests were contrary to good governance, where managers are fully accountable to their shareholders and investors can see who else may have an influence over the company which they own.'
The new rules will start next February.
Crackdown on 'secretive' CFDs by FSA
Daily Mail
24 October 2008
The strict stance applies to contracts for difference (CFDs) used by speculators to build cut price stakes in firms. Investors using them currently do not have to say how many they own.
But the FSA wants this to change and is planning to make investors disclose holdings of over 3% in any one company.
This will come as a blow to hedge funds, which have been known to use CFDs to build sizeable stakes in companies they wish to influence.
The FSA said the final draft of the rules on CFDs, under which one party agrees to pay another the difference between the current and future price of a share, would be published in February next year and come into force that September.
FSA Director of Markets Alexander Justham said: 'Our goal is to provide an effective and proportionate disclosure regime that works for all involved, and sustains market confidence and efficiency.'
CfDs - which are bets on changes in share prices taken with spreadbetting firms - are widely used by some traders because, up until now, it has helped them hide stakebuilding in companies. Several takeover bids have been launched on secret CfD stakes.
Today's ruling follows eight months of consultation with market participants and represents something of a compromise by the regulator.
But the move was welcomed by the Association of Investment Companies, whose director general Daniel Godfrey said: 'These undisclosed interests were contrary to good governance, where managers are fully accountable to their shareholders and investors can see who else may have an influence over the company which they own.'
The new rules will start next February.
