Hedge-fund firm D.E. Shaw Group was fined $75,000 for exceeding
bullish position limits in the natural gas market by 80% during
three trading days last October, according to a CME Group Inc.
(CME) disciplinary notice released Thursday.
The firm's Plasma energy fund had a long position--a bet that
prices would rise--of more than 1,800 contracts on the New York
Mercantile Exchange in November 2013 natural gas futures on Oct.
25, 28 and 29 of last year, in excess of the 1,000-lot limit, the
exchange said. The firm neither admitted nor denied the allegations
as part of the settlement. A spokesman for D.E. Shaw Group declined
comment.
The three trading days subject to the settlement were the final
three trading days in the contract before expiry. Prices in natural
gas futures were falling during the period in question.
The Wall Street Journal reported in February that the $650
million Plasma fund lost 28% in 2013. The firm's head of
energy-trading strategy, Jeff Myers, announced his retirement from
D.E. Shaw in January.
Write to Christian Berthelsen at
christian.berthelsen@wsj.com
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