Levying a financial transactions tax on foreign exchange trades in the European Union would hit pension funds and asset managers harder than banks, according to a new report commissioned by industry trade body.

The proposal to tax foreign exchange trades, which would be part of a planned wider financial transaction tax, would see a 0.01% levy applied to derivatives trades within the EU. The EU has said that spot FX trading would be exempt, but FX swap trading - which constitutes 45% of the $4 trillion a day global market - would not.