Goldman Sachs Advice Hands Clients Losses in Most Top Trades?

[oiltanker]

...Goldman Sachs Group Inc. racked up trading profits for itself every day last quarter. Clients who followed the firm’s investment advice fared far worse.

Seven of the investment bank’s nine “recommended top trades for 2010” have been money losers for investors who adopted the New York-based firm’s advice,

Goldman Sachs’s trading profits come from capturing bid- offer spreads when its traders act as intermediaries for clients, Gary Cohn, the firm’s president and chief operating officer, said last week in New York. Proprietary trading isn’t a main driver of earnings, he said.

Goldman Sachs executives have grappled before with questions about whether they’re better at making money for the firm than for their clients,....

http://preview.bloomberg.com/news/2...es-as-seven-of-nine-top-trade-ideas-flop.html

so the easy money is through capturing the spread not trading ?

 

[oildaytrader]

so the easy money is through capturing the spread not trading ?

They ain't got a clue what the word trading stands for.

They do not trade at all.

 

[oiltanker]

they know enough to not do too much themselves and make money out of those who do?

 

[Splitlink]

They churn the funds accounts, though. Read Liar's Poker by Michael Lewis. The main subject of the book were Saloman Brothers, but there is a great section on Milchen's (?) junk bond operation.

The thing is that they are all after your money and, if you have an account, poor you!

 

[oildaytrader]

Graduates gets handed an account to trade every day and churn out profit ,not for funds , but in churning spreads for the banks.The whole system is designed to screw the investors .

A fool and his money are parted in bogus pension fund management.Poor buggars parted in hope of pensions.

 

[gooseman]

so the easy money is through capturing the spread not trading ?

By golly, I finally think some people on here are getting what a broker-dealer does!

 

[DionysusToast]

According to many on here - Goldman trade support & resistance. Please don't burst their bubbles.

 

[oiltanker]

According to many on here - Goldman trade support & resistance. Please don't burst their bubbles.

yes that was the point of the op question.

 

[DionysusToast]

Arbitrage - taking advantage of price discrepancies or statisitical correlations
HFT - front running trades
Buy/Sell programs - reducing the footprint of large trades for their customers
Market making - capturing the spread

Lots of stuff that you or I couldn't do because of the costs/infrastructure needed.