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Goldman Sachs Principal Transactions Update: 826 Million Shares

Tyler Durden's picture




 

The week ended August 7 indicated that Goldman's PT on the NYSE is regaining its dominance after in the prior week it came perilously close to being overtaken by Morgan Stanley (not so much in principal as in agency trading). In the last week 800 million prgram traded shares transacted each day, 26.9% of total buy-sell volume. Unfortunately the NYSE has removed how this compares on an average basis to a 52 week trailing average which last we checked was around 25%.

And here is the prior week's action. Is Morgan Stanley just starting to realize the potential bonanza that PT is, especially in the HFT realm?

 

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Sun, 08/16/2009 - 13:42 | 38245 Xibalba
Xibalba's picture

A wise Prophet once said "The love of Mammon is the root of varios kinds of evil". 

Sun, 08/16/2009 - 16:02 | 38250 D.O.D.
D.O.D.'s picture

Xibalba, yes, the gates will be open soon..

"You can run on for a long time,

but sooner or later, gotta cut you down"

http://www.youtube.com/watch?v=1e0EQlQXoEo

Mon, 08/17/2009 - 12:03 | 38385 artcash (not verified)
Sun, 08/16/2009 - 13:49 | 38248 andrew123
andrew123's picture

Tyler, do you think that now that GS is increasingly in the spotlight, that they will be even more inclined to pump the market, or at least prevent it from going down, so that they can hold it over the SEC's head ("we are the only thing preventing a market meltdown.  Stop HFT and the market will collapse.")

Sun, 08/16/2009 - 13:55 | 38254 deadhead
deadhead's picture

John Mack must be regretting his decision to reduce risk......

Sun, 08/16/2009 - 17:46 | 38307 Miles Kendig
Miles Kendig's picture

Given that state of things failure to engage in heavy PT would increase risk to rapid growth of Mack's institution.  Although I agree that the sorry mess in its entirety is doing things to the institution of markets as a whole that are quite destructive.

Sun, 08/16/2009 - 19:11 | 38330 Arm
Arm's picture

I have tons of respect for John Mack.   Something tells me he will have the last laugh come October

Sun, 08/16/2009 - 13:59 | 38256 Anonymous
Anonymous's picture

TD -

A question on this data.

A I understand it, trading on the NYSE is now a minority of all daily trading in US stocks. The NASDAQ and newer venues like BATS and Direct Edge are important players. Granted, they do not (or at least I do not think they do) print similar numbers in terms of PT trading. So the NYSE is all we have, at least until we don't.

Still, the analysis here does not mention that the NYSE is now only 25-30% of the daily trading in US stocks. Does that ratio put this analysis in the realm of the interesting versus anything more significant?

On a separate point, thanks for all your hard work. You put out an AMAZING volume of work.

Mon, 08/17/2009 - 00:49 | 38478 mcnetgb
mcnetgb's picture

The July 09 numbers for matched market share of all US equities are:

NYSE 28.3%

Nasdaq 22.1%

Direct Edge 11.8

BATS 10.83

http://www.tradeoes.com/?q=news/2009/747

 

Sun, 08/16/2009 - 14:18 | 38261 zeropointfield (not verified)
zeropointfield's picture

And we have even twice Goldman Sachs on the list. Once Goldman Sachs Co, and once Goldman Sachs Execution and Clearing LP.

Sun, 08/16/2009 - 14:21 | 38262 zeta
zeta's picture

Has JPM always been like this (only 2.1M principal trading)? If not, can anyone take a guess what happened to it?

Sun, 08/16/2009 - 14:32 | 38266 Anonymous
Anonymous's picture

JPM disbanded its prop desk about a year ago.

Sun, 08/16/2009 - 15:09 | 38269 Anonymous
Anonymous's picture

Yo TD, can you mention something about Bloomberg's use of the word "probably"?

Sun, 08/16/2009 - 15:12 | 38270 i heart goldies
i heart goldies's picture

I think it's shocking that goldman does so much trading!!!1

Sun, 08/16/2009 - 15:26 | 38274 Milton
Milton's picture

I'm a little confused on how NYSE computes volume because when 100 shares are traded on the Exchange, that counts once, and only as 100 shares on the daily volume. But when the NYSE computes shares by broker/dealer don't they count that 100 share transaction twice and therefore the volume is doubled?

If someone can clarify, thanks.

Sun, 08/16/2009 - 16:12 | 38283 RobotTrader
RobotTrader's picture

Goldman's Prop Desk trading volume will be quickly dwarfed by mom and pop traders, Japanese housewives, Chinese gamblers, etc. if the SPY blows past the 1020 level and starts going vertical.

Just look at the record attendance at various "Money Shows", world record activity in sports book betting, and Lotto gaming.

And all the myriad ads appearing on how to get rich trading forex, options, futures, etc appearing daily in the business papers.

Its been almost 10 years since the public has been fascinated with stocks.

With so many in dire straits, never before have so many been forced into gambling as a means to make some fast money.

Sun, 08/16/2009 - 17:06 | 38299 Big Al
Big Al's picture

At least that's what the FED is counting on. 

Then they can dump their shares for a profit and use the proceeds to prop up Treasuries.

Mon, 08/17/2009 - 12:03 | 38396 artcash (not verified)
artcash's picture

allabout manipulation

We just

good articles; good articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions

Sun, 08/16/2009 - 17:49 | 38309 Miles Kendig
Miles Kendig's picture

The perpetual boom-bust cycle of our economic model is heavily dependent on just this activity.  Without it the next cycle may well not materialize.

Sun, 08/16/2009 - 18:34 | 38319 Hephasteus
Hephasteus's picture

It's like when bejing was going to go under comunist control. Everyone wanted to make as much money as possible so that if they didn't like it they could get out.

 

But I think it's the baby boomers. What LITTLE savings they had for retirement gone rampant inflation in the breach of the gun. It's going to get ugly.

Sun, 08/16/2009 - 20:05 | 38346 D.O.D.
D.O.D.'s picture

I was at a "technical analysis training class" aka "Let us pitch our software" this weekend, there were maybe 100 people there, I was one of 3 under 60.

Sun, 08/16/2009 - 17:21 | 38301 Anonymous
Anonymous's picture

I have a (naive) question I haven't seen raised here or elsewhere.

Should Commercial Banks be permitted to operate Dark Pools?

Now that Commercial Banks operate under explicit gov't guarantees (at least for US Banks, specifically Goldman) why is there no hue and cry about the gov't guarantees providing a competitve advantage to the CB owned Dark Pools?

Should the US Gov't be favoring the TBTF banks,through the guarantees, over the exchanges and other nonbank sponsored pools in this competitive battle?

The Gov't should be looking for ways to slim down the TBTFs, not favoring them in a competition within the Financial markets that increases the TBTFs systemic importance. The exchanges and ECNs and ATSs are not banks. Banks should not be exchanges or ECNs or ATSs.

Sun, 08/16/2009 - 17:45 | 38306 Anonymous
Anonymous's picture

Should Gov't Guaranteed Broker Dealers own Dark Pools?

Exchanges, non US banks, and other non bank Dark Pool owners don't have this advantage.

Should the US gov't favor one set of competitors (BDs operating as Commercial Banks)over the Exchanges and other Dark pool operators in this competition?

Putting aside the arguments about how Dark Pools should operate or exist for the moment, wouldn't our concerns about Goldman's monopolistic ambitions be mitigated if their Commercial Banking guarantees disqualified them from the competition?

Ironically, the US Govt is promoting increasing systemic risk by allowing those TBTF banks to compete in this arena.

Did Goldman get a waiver to allow them to continue when they converted to a CB?

Sun, 08/16/2009 - 17:47 | 38308 Anonymous
Anonymous's picture

Should Gov't Guaranteed Broker Dealers own Dark Pools?

Exchanges, non US banks, and other non bank Dark Pool owners don't have this advantage.

Should the US gov't favor one set of competitors (BDs operating as Commercial Banks)over the Exchanges and other Dark pool operators in this competition?

Putting aside the arguments about how Dark Pools should operate or exist for the moment, wouldn't our concerns about Goldman’s monopolistic goals be mitigated if their Commercial Banking guaratees disqualified them from the competition?

Sun, 08/16/2009 - 19:40 | 38338 Anonymous
Anonymous's picture

is this percentage of all market volume or just program trading?

Sun, 08/16/2009 - 20:03 | 38348 Anonymous
Anonymous's picture

Nice article. More evidence that GS controls the market action.

All longs need is for GS to place C at its conviction buy list in the midst of a sell off and the market will rally like no tomorrow. C may reach 7 in the ensuing short squeeze. See also http://invetrics.com

Mon, 08/17/2009 - 12:02 | 38386 artcash (not verified)
artcash's picture

Should the US Gov't be favoring the TBTF banks,through the guarantees, over the exchanges and other nonbank sponsored pools in this competitive battle?

We just

good articles; good articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions

Sun, 08/16/2009 - 22:47 | 38439 Milton
Milton's picture

I keep going back to the fact that GS made a profit on 61 out of 63 trading days. What is their explanation for this? All of their algo developers are really smart like Einstein?

This seems like common sense. Something is very wrong.

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