Morgan Stanley has agreed to pay $200,000 to settle civil charges it exceeded speculative position limits in soybean meal futures for two days while attempting to hedge a commodity index investment, U.S. regulators said on Monday. The fine, while small, highlights how tougher rules meant to apply tighter speculative trading limits in other raw material markets, such as oil and metals, risk curtailing banks' business in selling broad commodity baskets to investors, one of the most lucrative niches of the industry over the past decade. Morgan Stanley Capital Group's trading on the Chicago Board of Trade in January 2013 exceeded the all-months speculative position limit established by the regulator, according to the U.S. Commodity Futures Trading Commission. Its position “consisted of net long positions held by its commodity index desk to hedge its financial exposure" to the Dow Jones-UBS Commodity Index and to the holdings of the firm's other trading desks, according to the CFTC. A
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