Prop Trading

"We're Way Past Humpty Dumpty"

The most basic link in finance is that between risk and reward. Just like alchemists who once sought a path to gold from lead, a great deal of modern finance was built around finding a shortcut between them, but now, what is missing is reward, especially under conditions where there are no longer illusions about risk. We are way, way past Humpty Dumpty time. You can bring back prop trading, but you still have to have asymmetry for banks to trade in it. That ship sailed for good in late July 2011.

Trump Signs Executive Orders Rolling Back Dodd-Frank, Fiduciary Rule

As previewed earlier today, moments ago President signed two executive aimed at starting the process of rolling back the regulatory system put in place after the financial crisis. Among the targets are rules that protect against predatory lenders, force brokers to lower fees for retirees and ban proprietary trading.

Mnuchin Dashes Banker Hopes That Prop Trading Is Coming Back

In follow up remarks to lawmakers, Steven Mnuchin said even banking units that lack a government backstop should be restricted from making speculative trades: "a legal distinction between the insured and non-insured entity is an important factor in eliminating risky activities within the institution that has” insured deposits.

EconMatters's picture

Banks are cheap for a reason, they are not going to be high growers because of longer term structural changes in the Finance world some of which are fallout from the excesses of the Financial Crisis, and some have to do with technological and structural changes within financial markets themselves.

Schumer Says He Has The Votes To Block Dodd-Frank Repeal; Threatens Supreme Court Filibuster

Senate Minority Leader Chuck Schumer drew a line in the sand for the next administration and said he has the votes to stop President-elect Donald Trump from repealing the Dodd-Frank Act and “the rules we put in place to limit Wall Street." In an interview on NBC's Meet the Press, Schumer said " I think they should forget about that. We have 60 votes to block them."

How A 34 Year Old Goldman Trader Made $100 Million In A Few Months

The curious case of how a 34-year-old high-yield trader at Goldman managed to make $100mm in profits in just 6 months while somehow maintaining compliance with Dodd-Frank regulations...“It goes against everything we’ve been seeing the last three years."

Goldman Smashes Expectations As Trading, Prop Revenues Surge, "Average" Employee Makes $322,607

there was little concern that Goldman - the pure-play trading powerhouse (at least until the recent launch of a retail lending and deposit operation) would likewise surpass Wall Street's expectations, and moments ago that was confirmed when Goldman reported EPS of $4.88, smashing expectations of $3.86, as profit jumped 47% from a year ago to $2.1 billion. The profit beat was driven by a 19% spike in revenue which rose from $6.9 billion to $8.2 billion, beating consensus estimates of $7.6 billion.

After Slamming IEX, Nasdaq Launches Product For Traders Seeking To Avoid HFTs Frontrunning

After a lengthy battle seeking to end IEX' hopes to launch an exchange, NASDAQ plans to introduce an investor friendly “extended-life” order type. This proposed order type, would allow orders that remain live for at least one second to jump ahead of orders at the same price that do not. Investors  who use such an order type would not have to worry about competing with  speedy HFT’s to get to the top of the queue, according to CEO Robert  Greifeld.