Correction: as a few commenters noted, Goldman Sachs may be engaged in Flash trades, but they’re not frontrunning clients with the practice.
Original post: Some suggested that the brief dip in Goldman Shares at 11:44 this morning was not due to our appearance on CNBC “Call of the Wild Segment”, but rather Chuck Schumer’s comments about an imminent ban of “Flash” trading, and the belief that this is a big source of profits for Goldman Sachs.
Via ZeroHedge, the bank has sent out a letter to clients basically claiming: We don’t do Flash trading, and our involvement in High-Frequency Trading adds liquidity to the market, while accounting for less than 1% of firm-wide revenues.
Summary: if they ban this stuff, it’s no big deal to us.
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