Proprietary trading


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Proprietary trading

Principal trading in which firm seeks direct gain rather than commission dollars.

Proprietary Trading

The act or practice of an investment bank conducting trades on its own account, rather than on behalf of a client. Proprietary trading has three primary benefits. First, it allows the investment bank to profit on its own instead of simply collecting commissions and fees from clients. Secondly, it lets the bank build an inventory of securities. This can be useful if a client places an order for the securities in an illiquid market. In such a situation, the investment bank can fill the order from its own inventory. Finally, proprietary trading allows the bank to make a market when it is assigned to ensure the liquidity for a given security.
References in periodicals archive ?
14, 2015 /PRNewswire/ -- During the fourth quarter of 2014, T3 Trading Group, LLC ("T3"), a Member of NASDAQ OMX PHLX purchased the trader base of WTS Proprietary Trading Group, LLC ("WTS"), also a NASDAQ OMX PHLX Member firm.
Global Banking News-December 17, 2014--EU commissioner says plans to curb proprietary trading to go ahead
Instead, Britain should use the threat of capital add-ons or other tools to bear down on any bank that shows signs of proprietary trading, said the Parliamentary Commission on Banking Standards (PCBS).
Jakobsen has more than 20+ years of experience within the fields of proprietary trading and alternative investment.
Hong Kong Acquisition of proprietary trading desks of banks by private equity firms could pose serious regulatory hurdles as transparency levels in private equity are far below the listed firms and banks, said leading market regulators at the Asian Financial Forum yesterday.
According to a person close to the firm, Goldman Sachs is ceasing proprietary trading in one type of structured debt.
NEW YORK: President Barack Obama s economic adviser, Paul Volcker, said his proposed banking rules would force Goldman Sachs and other banks to give up their bank charters if they want to continue proprietary trading.
Big banks have begun to find ways to cope with Obama's new regulations proposed on Thursday to reduce proprietary trading at financial firms.
Restructuring could include clear separation between retail deposit taking business and businesses involved in proprietary trading activities, with the latter able to fail even if the former were supported in crisis conditions," the FSA said.
said Thursday it will launch a proprietary trading system on Aug.
This reasoning suggests the hedge fund universe can be decomposed into only two groups for the purpose of understanding governance issues: those hedge funds that engage in proprietary trading and those that are more like private equity partnerships.