[HK_Newbie100]

hey freeier...what post did you use to hold in a bank. I'm really interested to learn about trading positions within the financial institutions. Was it purely salaried or did you get a share of any trading profits you made. What type of trading positions are available. are you still doing something similar.

[freeier]

used to be ? a trader in equity derivatives and indices and also looked at other financial instruments in interest rates etc, structured products...

most big banks don't do profit sharing. u have a budget u make more than the budget u get a good bonus that some tie to the profit but others just set them arbitrarily. some smaller banks might contract with u a 70-30 kind of profit scheme but i haven't heard about it these days.

no i am doing more structuring now. not trading.
there are lots of trading positions but i doubt they recruit fresh people for that. most trading position requires quanti background and rarely they recruit straight cash traders anymore. if you want to join a bank, get yourself a good financial engineering degree with a thesis or final year project in hull-white or BGM model and likely u will have some people willing to talk to u.

[greentea]

Thanks for the interesting debate...

Anyway, I think there are many factors to become a multi-millionaire!! All in all, luck plays the important role too.

[HK_Newbie100]

This week confirms my belief that we are at the beginning of the mother of all crashes in stocks, real estate, bonds, and virtually everything else over the next 2 or 3 years. Nothing except certain commodities will be immune.

I think the market is beginning to realise that their bullishness of only a couple months ago (eg talk that interest rates have peaked???) was misplaced and that in fact, we maybe facing some very rough times ahead. I think there has been a total wake up call and paradigm shift in market sentiment as of the last couple of weeks, last couple of days especially. Smart money has been short for a while now, but the wider market is now catching up. When we see a convergence of selling across the board, then things will get very ugly.

If you’re concerned about your financial well being, you might want to consider selling all your investments, including your home. Sell up and just sit on your money for a while if you don’t want to re-invest in speculative investments. The price of many things will be decimated. I think it won’t be a pretty sight by the end of the year. Just my 2 cents….

[freeier]

When people in the street thinks its so bad, then i'd think otherwise. 8-)
when people think too bullish, then i'll be more cautious of a crash...

let's see what happens then...

[HK_Newbie100]

when people in the street read books on contrarian investing, then I'm definitely short

just kidding mate!

[kombuchakid]

Dangers of the herd mentality

It is too early to say whether the recent declines in global stock markets signal anything out of the ordinary. Though large, they are hardly unprecedented. But the fact that they've occurred simultaneously suggests herd behaviour. Spoiled by years of cheap credit, global investors seem to be reacting to the prospect of higher interest rates by fleeing stock markets almost everywhere. There is danger of a broader financial and economic setback.

The riskiest and most mysterious aspect of the present situation is the increasingly global nature of investment capital. Once, capital was largely compartmentalised by nation. Americans saved and invested in the United States; Germans saved and invested in Germany. That world is disappearing. Now it's routine for pension funds, mutual funds and many wealthy investors to move money into and out of American, European, Asian and Latin American stocks and bonds.
The magnitudes are immense. In 2004, Americans invested US$856 billion abroad, while foreigners invested $1.44 trillion in the US, the International Monetary Fund reports. "Emerging-market" countries (China, India, Brazil and many developing nations) received US$570 billion in foreign investment and made $935 billion in investments abroad. About US$515 billion of the outflow came from governments - dominated by China and other Asian nations - that reinvested trade surpluses, often in US Treasury bonds.
Thirty years ago, such massive global money movements did not exist. Most countries had extensive capital controls restricting how much (or whether) their citizens could invest abroad and how much (or whether) foreigners could invest in their countries. Since then, many countries have relaxed or removed controls.
In theory, liberalisation benefits everyone. Capital flows to the most productive investments. Huge capital inflows have clearly helped China by financing new factories with modern technology. In many ways, the world economy seems healthy. But there's a rub: global finance has created new risks. At least two stand out.
The first is huge trade imbalances. The US is running massive deficits, counterbalanced by big surpluses in China, Japan and other Asian countries. Most economists consider today's imbalances unsustainable.
The second is the risk of worldwide financial crises. Global investors may move in herds, pouring money into some countries - or investments - and then withdrawing it abruptly. That happened in the 1997-1998 Asian financial crisis: capital flight plunged nations into deep recessions.
Some economists, most prominently Stephen Roach of Morgan Stanley, consider the recent stock market declines a healthy sign - a retreat from speculative behaviour. Mr Roach welcomes higher interest rates. Last week, the European Central Bank raised rates; so did some central banks in Africa and Asia. The US Federal Reserve has been raising short-term rates since June 2004, and may do so again this month. Stock, commodity and housing prices may weaken, says Mr Roach, but the "real economy" of production and jobs won't suffer much.
This seems plausible. But so is something more menacing: losses in one market prompting investors to sell in others. As stock markets and housing prices sag, consumer and business confidence ebb. Economies that depend heavily on huge exports to the US weaken. High oil prices hurt.
We really don't know much about the interconnectedness of global financial markets. They are too new and changing too fast. We can see the promise and the peril - but don't know which will prevail.

Robert Samuelson is a Washington Post columnist.

from a local rag