If you want a sign of how much fear remains in the market, look no further than Morgan Stanley’s denial that it has prime brokerage exposure to Citadel.
This afternoon the bank began vigorously squelching speculation that it had suffered losses from the Porsche-Volkswagen short squeeze or Citadel’s travails. Reuters files this report:
Spokesman Mark Lake, knocking down rumours that had pushed its shares down 11 per cent Tuesday, said the New York bank did not bear any exposure to either company. Morgan does not even currently have a prime brokerage exposure to Chicago-based Citadel, he said.
“We have virtually no exposure to Volkswagen or to Citadel,” Lake said.
Morgan Stanley, which runs one of the biggest prime brokerages businesses in the US, was widely thought to have some prime brokerage exposure to Citadel, which claims to be using a wide range of prime brokerage desks to reduce its exposure to their counter-party risk. See? It will all be OK. No one is exposed to any risk from anyone else at all.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.