Wall Street banks' equities-trading units aren't getting much relief from the strongest stock rally since 2009, as sinking volume and already thin margins threaten to make their annual performance the worst in six years. Third-quarter equities-trading revenue probably fell 14 percent from the same period in 2011, the fifth straight drop of more than 8 percent, according to estimates by Kian Abouhossein, a JPMorgan Chase & Co. (JPM) analyst. Full-year revenue at the five largest U.S. investment banks may be the lowest since 2006, UBS (UBSN) AG's Brennan Hawken wrote in a Sept. 19 note to clients. http://finance.yahoo.com/news/wall-...RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25z;_ylv=3
Give it a few days and this will be cited as another failure of Obama's presidency in the pages of Investor's Business Daily. It should be noted that Stephen Hawkings is still alive!
"It's going to be a continued environment of risk-aversion and really quick trigger fingers on the part of portfolio managers to protect gains," said Davis, who is based in Washington. "It will be quite some time before there are money flows into hedge funds and you have aggressive money going after aggressive returns like the old days." Royal Bank of Scotland Group Plc said in January it was exiting cash equities, the trading of common shares on public exchanges, and failed to find a buyer for its European unit.
Why do you think HFT is finally starting to become a hot topic in the mainstream media? Flash crash? Nope. KCG debacle? Guess again. Banks are getting smoked by HFT powerhouses like Getco and Hudson River trading. Everything was fine as long as the banks were printing money. Canabilization has left only the best (or in this case, the fastest) firms still making money. Look for HFT rule changes to come from the bank owned SEC in the near future.
Equity HFT powerhouses are mostly hurting too. I'd have bought your argument in 2008, maybe, although the anti-HFT propaganda campaign seemingly started after 2008. Also, while I do think the fastest firms are still making money, I don't think the margins are there. They're going to have guys with shitty bonuses, more layoffs, and hesitation in terms of buying more technology.
aren't all of them reported record profits from trading without any single losing day? BAC,GS,MS and so on. too lazy to search for that article,but it's should be some where on ET well..anyway..this is what you get sooner or later,when you squeeze every retail trader\investor from stock market..now it's dog eat dog..sorry..bot eat bot..
It's not that difficult to have strategies that don't have losing days with a few core, key trades and decent infrastructure. That still doesn't mean there's enough money in the winning days to make it worth it.
Clubber Lang is right on the money. Trouble is the SEC doesnt have a clue to fix this problem. They'd be smart to start charging crazy fees and actually enforce BBBO, but they don't have the chops.