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Soc Gen On The Art Of Hedging (Tail) Risk
This week, Soc Gen's Stephen Antzak delivered the definitive presentation to a sell out (no pun intended) crowd of bankers and hedge funders, on how to hedge [idiosyncratic|market|correlation|macro] but most importantly, fat tail risk: the biggest bogey man in day and age when commodities open limit up, and when any day the ES can open limit down. What are the cheapest hedging strategies? What are the best pair trades? How should one be positioned in this environment of unprecedented correlation? All these and many more questions are answered by Antzak in this all encompassing presentation which we are happy to bring exclusively to our readers.
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Didn't SocGen put one of their traders on trail for taking on hedging contracts that cost them $6 billion? As long as they make money the former CEO, Daniel Bouton was happy & took full credit for the results.
But when the shit hit the fan, the trader was left cut & dry on his own to be prosecuted criminally. He got 5 years and must serve 3 years minimum. And the trader must pay back the $6 Billion hedge unwinding loss.
I hope SocGen accepts personal checks?
Jerome Kerviel, the trader, is my fucking hero. He put a hell of a dent into the armour of that bastard bank!!!
And in exchange for Jerome's taking *all* the blame the bank will not pursue the €4B it is owed. Hmm right, something tells me he got a lot more under the table that just the waver... to keep quiet about how it was inside the bank.
rrrooowwwww.
In the verdict in the case of Jerome Kerviel, the French people instantly reacted with outrage, identifying him as one who was forced to take the fall for his bank superiors who clearly allowed his trades, probably on the chance that they would generate income. One newspaper headlined the verdict: Goliath Slews David.
NPR’s reporter from France said this week that the order requiring Kerviel to repay the $6.8 billion trading loss on his technology consultant salary was the main point of the outrage expressed by the French people she interviewed. The French consider it vindictiveness by the court; that it wasn’t a just ruling. The court, they believe, is in the pocket of the bankers.
Kerviel plans to appeal, she said, but he’s already won in the court of French public opinion.
As for Soc Gen forgiving the repayment, why not? The central bank will just print them more.
Just wanted to remind you why the looting will continue: unemployment rate for those with a Bachelor's degree or higher FELL in September, from 4.6 to 4.4. Sound like a revolutionary statistic to you? Not really.
Unemployment rate
5.0 5.0 4.5 4.8 4.7 4.4 4.5 4.6 4.4According to a recent OECD report in The Economist last month, one-third of college graduates in the United States between the ages of 25 and 29 work low-skilled jobs.
Spain and Canada are highest in terms of percentage of young adults who work in low-skilled areas -- in Spain, nearly 45 percent of young adults hold lower-skilled jobs, in Canada about 37.5%—followed by the United States at nearly 33%.
British graduates aged 25-34 earn $57,000 on average, their Swedish peers earn $37,400 and U.S. peers, $56,200. Poland’s graduates $11,800, Germany’s $55,400.
In related news, a recent report from ABC7 Chicago detailed how more college graduates were on the hunt for blue-collar jobs…
http://www.economist.com/node/16984636
"Black Swan' Author Says Investors Should Sue Nobel for Crisis"
I'm with TALEB!!! f*&@ EM ALL!
Markowitz & Finance DRONES shouldn't be investors or anywhere investment decisions.
Bloomberg: http://www.bloomberg.com/news/2010-10-08/taleb-says-crisis-makes-nobel-panel-liable-for-legitimizing-economists.html
the term was called "Present at the Creation." Welcome to "the Age of Hedge Funds"--they have arrived, day're in da house. Day may even be in da White House!
Interesting. I didn't know you could hedge positions with puts. Now I can do my 3am USD/JY sell and buy a put to hedge my position. Thanks!
Very interesting but not downloadable or printable
Can you do something about it?
Hedging requires adult supervision. Soc Gen should come back AFTER they re-establish some credibility (maybe 100 years?).
It takes the supreme unbridled arrogance only a Frog can muster after their recent experience to even suggest hedging tail risk could be termed an art. They can't even figure out book. Fucktards.
Is there anything not broken anymore?
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