> The Goldmanite trails off. “What do they do? No, seriously. Do you know?”
So not even Goldman Sachs knows what they do? Goldman is also incredibly secretive, so kind of funny to see one of theirs being surprised by that behavior elsewhere.
So not even Goldman Sachs knows what they do? Goldman is also incredibly secretive, so kind of funny to see one of theirs being surprised by that behavior elsewhere.
Goldman's prop days are numbered (theoretically) with the new legislation that inhibits banks trading their capital so vigorously.
If you have evidence of this, please notify the SEC so they can permanently shut down Goldman's brokerage operation and file criminal charges against the people involved.
If you buy a stock from me, and I talk to 1000 more people just like you, who all buy more shares of the same stock, I will have a view that this stock is getting a lot of interest. Nothing illegal or criminal about that.
If you are in this position, you work in brokerage. You have this view, but since you don't work on the prop desk, you have no ability to act on it [1].
It is highly illegal for you to reveal this information to anyone working the prop desk.
[1] You could trade on your own personal account, but that is highly regulated also.
A market maker is merely a prop desk running a particulra strategy. They have no information on Goldman's clients. They behave exactly like any hedge fund.
Insider trading is a red herring, I don't know why you bring it up. Mdda claims Goldman is breaching their fiduciary duty to their clients.
Also as a market maker, it's difficult to ignore what's going on if all the smart money is selling, and all the dumb money is buying.
FWIW, the vast majority of market-making is taking place outside of the stock exchange : End-users are at a natural disadvantage, since they can't see all the flows.
The common understanding is that a market maker is not exactly a prop desk. The clients of a market maker are the counterparties who take the other side of the market maker's markets. (These counterparties are Goldman clients). Market makers are not hedge funds and don't fundamentally behave like hedge funds, though I suppose both during their line of work take views on markets, so there are some similarities.
My point was, market makers, by definition, know what (their) clients are doing and take market views based on this. The major value in being a market maker (which is a huge part of Goldman's capital markets business) is seeing client flow.