STOCKS | Banks Tighten Leverage Limits on Hedge Fund Bets in Asian Chipmakers

Global banks are curbing hedge funds’ leveraged positions in leading Asian chipmakers, including SK Hynix and Samsung Electronics, after sharp gains this year raised concerns about a potential pullback. According to Jin10, people familiar with the matter said brokers including Citigroup, JPMorgan, and Goldman Sachs have increased financing costs for hedge funds using swaps to take positions in SK Hynix and Samsung Electronics shares. The sources said banks have also reduced the size of new trades and tightened which firms can access the transactions. Some banks have declined new swap requests from clients or are reviewing them on a case-by-case basis. The sources added that banks have taken similar steps regarding Taiwan Semiconductor Manufacturing Co. (TSMC).