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What Are the Main Regulatory Requirements for a Prime Broker’s Clearing Operations?

Capital adequacy requirements, robust risk management systems, client fund segregation, and regulatory reporting.
Greeks.Live14.11.25

What Are the Main Regulatory Requirements for a Prime Broker’s Clearing Operations?

Prime brokers must adhere to capital adequacy requirements, such as those under Basel III, to ensure they have sufficient capital to withstand potential client defaults. They are also subject to strict operational standards, including robust risk management systems, segregation of client funds, and comprehensive reporting to regulators regarding their derivatives exposures and capital.

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