A Securities and Exchange Commission (SEC) proposal mandating central clearing of most US Treasury trades will drive up transaction costs and squeeze smaller participants out of the market, according to a senior trader at Bank of America.
“The big players will get bigger, both on the buy side as well as the sell side, and I think pricing will get wider,” said Kavi Gupta, co-head of global rates trading and counterparty portfolio management at Bank of America Securities. “The returns that
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