Morgan Stanley Chief Executive James Gorman had a plan: center the firm’s focus on its thriving wealth management business and wash out most areas that accompany risk. So far, the plan has worked wonders, contributing to the bank’s 46% rise in earnings during the second quarter. But maybe now it’s time to open it up a little, take some risks and see what this thing can do.
With other competitors retreating, Morgan Stanley is planning to ramp up its commodities trading unit in the U.S., according to Reuters. The bank will look to bring on roughly a dozen traders, sales staff and other commodities pros, likely split between its New York and Houston offices.
The bank is specifically looking to unlock opportunities with retail investors looking to bet and hedge with structured products and commodity-linked derivatives, according to the report. It will also look to make more commercial loans to energy companies.
The move is a bit of an eye-opener for Morgan Stanley as the bank has taken a firm risk-averse approach over the last two years. Competitors like Deutsche Bank and Barclays, for example, are pulling out of commodities trading as client volumes continue to wane. Morgan Stanley appears to be betting that they’ll return soon.
They’re not the only one, though. Citigroup is also bucking the trend, increasing headcount within commodities by around 15%. Wells Fargo and BTG are also looking to make a bigger push into commodities trading.
We’ll have to wait and see which strategy is the right one.
How much money do you need to make to be happy? A new study has created a national benchmark, but the figure is highly dependent on where in the country you reside. Hint: you need to earn a lot more in New York for life not to be a drag.
With the benefit of hindsight, former senior investment bankers and relative industry newbies give their insights on how to survive – if they’d known then, what they know now – as an incoming analyst.
The SEC is investigating 44 investment firms, including “some of the largest hedge funds and asset management advisors in the nation,” to determine if they participated in insider trading in health insurance stocks. A Washington research firm may have tipped the hand of a forthcoming government action.
J.P. Morgan’s board has stood by Chief Executive Jamie Dimon through thick and thin. Now they’re rewarding him. Dimon can collect $37 million worth of stock options offered during the financial crisis that vested only if the board deemed appropriate. They just did.
BlueCrest Capital Management is continuing its growth plan, this time in Asia. The hedge fund giant is opening an office in Hong Kong to be headed up by James Chen, a current Singaporean staffer.
If you live in New Jersey and enjoy a good renovation project, a rather large political presence is looking for a good finance man. Republican Governor Chris Christie’s chief economist has resigned. The deadline for applicants is July 30.
HSBC is building out its M&A team in Europe. The bank just hired former UBS banker James Simpson to help run the team in EMEA. Expect more hires to follow.
Buzz Around the Office
A Kentucky man arrested for shoplifting had an ingenious plan to get back at the cop who booked him. He ordered five pizzas under the officer’s name and had them delivered to the jail. The police then tracked the orders to the man’s cell phone and arrested him again, which was easy considering he was still at the station.
Quote of the Day: “At what age do you think it’s appropriate to tell a highway it’s adopted?” – Zach Galifianakis