Comment Text:
I believe updating the reporting rules, as proposed, may improve the CFTC's ability to assess
potential systemic risks due to a portfolio's concentration in a directional trade. However, I feel a portion of the proposal (as quoted below) may have unintended consequences in constraining market liquidity if the time frame of the exposure were to be less than one day or within one trading week.
"The proposal also would require qualifying hedge funds to identify all
other counterparties (by name, LEI, and financial institution
affiliation) to which a fund has net mark-to-market exposure after
collateral that equals or is greater than either (1) five percent of a
fund's net asset value or (2) $1 billion and would require these
advisers to report the amount of the exposure before and after
collateral posted by either the counterparty or the reporting fund as
applicable."
