Financial Times – Since 2010s introduction of the so-called Volcker rule, Wall Street\u2019s banks have moved fast to drop some of the most prominent vestiges of their past success: their proprietary trading operations.
\nBanks once dominated bond and equity markets thanks to the operations of such desks \u2013 which acted, to all intents and purposes, like internal hedge funds, speculating with a bank\u2019s own capital \u2013 but now their presence is barely felt.<\/p>\n
Banks once dominated bond and equity markets thanks to the operations of such desks \u2013 which acted, to all intents and purposes, like internal hedge funds, speculating with a bank\u2019s own capital \u2013 but now their presence is barely felt.<\/p>\n
The exit began with Goldman Sachs, which starting in 2010 saw the departures of its three main prop traders and their teams: Pierre-Henri Flamand in Europe left to set up a hedge fund, Edoma Capital; Morgan Sze in Asia departed to establish his hedge fund, Azentus Capital; and Bob Howard in the US left to set up a hedge fund for private equity house KKR.<\/p>\n
It was a pattern repeated by peers. Deutsche Bank, Morgan Stanley, Barclays and most recently JPMorgan have all lost top risk takers to the hedge fund industry in the past 18 months.<\/p>\n