Daily Investment Tips

As the news of UBS $2 billion loss continues to ripple the financial markets we look back at other infamous traders who nearly brought down their employers and others like Nick Leeson who caused the collapse of Barings Bank, the United Kingdom’s oldest investment bank.

Jerome Kerviel – Former Societe Generale trader. Losses at French bank were 4.9 billion euros ($6.7 billion)

Nick Leeson – Infamous Nick caused the collapse of Barings Bank, the United Kingdom’s oldest investment bank. Nick left Baring Bank in the red for $1.4 billion. The bank went solvent.

Evan Dooley – MF Global – losses $140 million

Steve Perkins – PVM Oil Futures, losses $10 million

Alexis Stenfors – Merrill Lynch in London , losses $456 million

John Rusnak – Allied Irish Bank, losses 691 million

 

 

written by Constantine Njeru \\ tags: Allied Irish Bank, Bank Jerome, Baring Bank, Barings Bank, Collapse, Dooley, Financial Markets, French Bank, Global Losses, Investment Bank, John Rusnak, Merrill Lynch, Nick Leeson, Oil Futures, Rogue Traders, Societe Generale, Steve Perkins, Ubs

Jim Simon is a hedge fund manager with Renaissance Technologies. A.K.A as “Quants”  Traders with PHds and rely on complex mathematics in making money.

When they came to the scene with their mathematical models for investing it seemed they had found the answer to the age old question “Is there a perfect formula to make money in the stock market?”

From a NYT article:-

Mr. Simons was celebrated as the King of the Quants after his in-house fund, Medallion, posted an average return of nearly 39 percent a year, after fees, from 2000 to 2007. It was an astonishing run rivaling some of the greatest feats in investing history.

With those kind of results it was easy for investors to get carried away with the idea that Jim Simon and the rest of Quants family were the messiahs.

Past results is not an indicator of future performance.

After the collapse of Bear Sterns and Credit crises most Quant funds are fighting for their own survival. The NYT article further reported : -

The combined assets of quantitative funds specializing in United States stocks have plunged to $467 billion, from $1.2 trillion in 2007, a 61 percent decline. And One in four quant hedge funds has closed since 2007

written by Constantine Njeru \\ tags: Bear Sterns, Collapse, Crises, Feats, Hedge Fund Manager, Investment Returns, Jim Simon, Jim Simons, Mathematical Models, Medallion, Nyt, Nyt Article, Phds, Quant Funds, Quant Hedge Funds, Quantitative Funds, Quants, Renaissance Technologies, Stock Market, Trillion