Use of leverage underlying Archegos margin call raises concerns (MarketWatch)

Certain types of swaps and other derivatives were the primary securities involved that led to the recent Archegos Capital margin calls. The subsequent fallout resulted in major financial losses at some banks, including Credit Suisse’s and Nomura’s prime brokerage businesses. The types of leveraged trades utilized, including CFDs, may be something that the SEC and other regulators weigh in on following their review of the situation, comments FrontLine’s Founder and President Amy Lynch. Ms. Lynch also expects the banks to take a close look at their internal controls and practices around these instruments. See MarketWatch, “Here are the complex bets at the heart of ‘unprecedented’ Archegos-linked $30 billion margin call“