I was talking to friend of mine about trading stocks. He mentioned to me that he needs to fill out a form and submit it to some office in his company and buy the stock the next day. He was complaining that he has missed several great opportunities because of that. I was shocked to hear this from him because he is just a fund accountant. I can not imagine what would be the situation if he was an equity analyst in bulge bracket firm. I know that there are numerous equity analysts in this forum. How do you guys trade stocks? It is just ironic that someone knows so much about the stocks, but can not trade them. What are your thoughts on this?
it is not about you, it is about your clients – always put them first. this is the major lesson in the ETHICS section – I hope you read it. I assume you are a level 1 candidate : ) - most SS and buy side firms let you trade your own account, but you have to wait. sometimes, the wait can be pretty long. it is part of the job and one would expect this going in, esp after all the scandals post 2000. the restrictions make perfect sense. if you work at a huge BS firm and buy the stocks your firm is buying before they execute their big orders, that would be front running – and wrong. when you start a firm, they go thru all of this with you and you have to sign a bunch of compliance forms. if you trade, some firms require you to disclose your holdings intermittently.
because of all compliance rules at my firm, i’ve dropped the towel on trading for the last year. got lucky cause I’d be pretty poor by now if I wasnt full cash
daj224 Wrote: ------------------------------------------------------- > it is not about you, it is about your clients – > always put them first. this is the major lesson in > the ETHICS section – I hope you read it. I assume > you are a level 1 candidate : ) - Not really. There are several instances where something may be perfectly suitable for me that is not for my clients. You are always quick with the quips - I understand my firm’s compliance system pretty thoroughly and can say that knowledge did nothing for me on L1 or L2. > most SS and buy side firms let you trade your own > account, but you have to wait. sometimes, the wait > can be pretty long. it is part of the job and one > would expect this going in, esp after all the > scandals post 2000. This is true, but this has also taken shape over the past 2-3 years for most botiques and smaller firms and is a tough adjustment. > the restrictions make perfect sense. if you work > at a huge BS firm and buy the stocks your firm is > buying before they execute their big orders, that > would be front running – and wrong. Its only front running if you have knowledge of it before hand. > when you start a firm, they go thru all of this > with you and you have to sign a bunch of > compliance forms. if you trade, some firms require > you to disclose your holdings intermittently. only if you are at a good one.
budfox, good points. i was just trying to cover from what ive seen in my experience. obviously, it is onlt front running if you know about it, but the original poster seems to be attracted to the idea that b/c you know more about stocks than the masses, you should be able to trade freely. I wasnt sure if he even know about front running, so i wanted to put it out there.