LONDON, Thurs: Hedge funds are increasingly looking to derivatives to give them low-cost exposure to booming emerging market stocks, a global brokerage firm said yesterday.
Many hedge funds prefer to use derivatives such as contracts for difference (CFD) because they only have to put up a margin of between 10 and 25 per cent of the value of the securities.
“There has been an acceleration of hedge funds wanting to use CFDs for emerging-market stocks,†Fleur Gremmen, London-based chief executive of brokerage firm Global Trader said.
