Goldman = Casino, and casinos make money. Why? They make the rules. They set the odds. They collect the vig. And most importantly, if the players learn how to game the game, they change the game. You're either the casino or a player. Which one are you? If you're reading this, you ain't the casino.
the only way i can think of to win 99 out of a 100 days is thru' arbitrage but even then the spread one earn is v thin, which means u have to perform a few hundred trades a day, but that would also mean there is a constant stream of suckers for u to skim from, wonder who those counterparties r
Is this seriously your explanation for why they trade so much better than everyone else? You are seriously an idiot.
lol Its easy Give one trader 1 billion trading capital Trade a stock like AMD (which i used to trade on a daily basis) He decides, lets make AMD move up 20 cents... So he eats up crazy crazy amount of shares, forming a short squeeze. Then as more people cover/chase AMD, he sells into them. Then it reaches a tipping point and he punches 5-10 prices levels sell/short, making the stock spiral downwards... catches it again with massive bid up... repeat This is what they do on a daily basis... And theres absolutely nothing you can do about it with your tiny capital. With a billion in capital behind him, he can move the stock whichever way he chooses. Just pray your on the right side as he is. GS and some other firms are the biggest fish in the ocean.. I used to trade a ETF called EWJ which tracks the japanese markets during US market hours. Theres a lot of automated trading that goes on with this ETF, but also there is a lot of "Spoofers" (Probably rich Japanese traders) That would create a ridiculous bid/ask amount on one side for a few seconds. - Say theres 10k share on bid, he will "spoof" using 500k shares so that the computers get scared and pull all their bids/offers. Thus he has a big influence in the direction of the stock. But once... I saw this guy Spoof for about 200-250mil worth in shares, he did it 1-2 times previously in the day and this time, as soon as he spoofed, someone with a ridiculous amount of capital, punched all of his shares....the spoofer was short and forced to cover causing the stock to Rip..... and I bet the guy who punched the spoofer sold it back to him. Goes to show theres always bigger fish in the ocean, but for GS, they are the biggest fish =]
There's nothing new here. I recall some article 2 years ago about JP Morgan making deceiving 8 days of losses in one quarter or something like that... I would also be interested in how many losing days an option market maker like Timber Hill makes on average. It is incredible to see that only a few like Pabst get it... Market making is the heart of their game and it is even simpler to make money collecting ticks edges all day long than trying to corner/manipulate/getting info from Geithner...I don't say it doesn't happen, it's just not the core of their performance. Goldman is an army of Szeven's with better tools and almost no concurrence... For sure they have almost no losing days.
+1 If GS is NOT making money, THEN and ONLY THEN should you be worried. When correlations go to 1.... we're all fubared.
And, apart the possibility to have impact on prices, it's quite clear that when trading backed with huge amount of money it's almost impossible to lose. Actually, you must really make an effort to devise unprofitable strategies! ) The more money you have, much more you make (it's not linear) ... ____________________ Tom