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Critical Analysis of the Departments
Pages 12 (3012 words)
Critical Analysis of the departments Trading Trading is the most significant source of the revenue for the company. The department is mainly divided into two main sub business which is propriety trading and execution of trade on behalf of the client. Propriety trading has been the primary source of generating revenue when it comes to investment banks all around the world.
It is a general and accepted notion in financial market that propriety trading is much riskier than non-propriety trading as it results in more volatile trading. Financial analyst believes that firms and investment banks usually leave the financial market in ambiguity when it comes to their quantum of propriety trading and non-propriety trading. TPG believes that it has competitive advantage over other players in the market that is way it has its major investment in propriety trading. Certain percentage of revenue, but comparatively lower, is generated from non-propriety trading which is also referred to as the flow trading. In financial terms, the flow trading is conducted by the firm on behalf of the client funds and the firm’s revenue is the commission earned on this trading. The company has been focusing on its flow trading business as well as it is likely to generate more client information which thus supports propriety trading eventually. The trading department of TPG works in close collaboration with Quantitative Analysis and Sales department which provides the relevant logistic support to the trading department. ...
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