Guidelines emerge

January 6: Reports emerge that US regulators plan to create a three-tier system for regulating prop trading, the first of which would involve automatic "tripwires" that would alert a compliance department to proprietary trading. This tripwire might, for example, include the size or riskiness of a trader's position. The second tier would see internal compliance and risk management departments interrogate traders on the nature of their positions, after which onsite regulators would be called in to monitor the situation.