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Comparing sophisticated market makers trading using their own money to "hedge funds" run by some rich guy's son charging 2 and 20 are hardly the same. The bank

Comparing sophisticated market makers trading using their own money to "hedge funds" run by some rich guy's son charging 2 and 20 are hardly the same. The bank in Margin Call was packaging MBS out of mortgages, not speculating on the price of commodities using derivatives to gain leverage.

robertlagrant 4y ago
The person you're replying to was talking about futures traders. Where did you get a rich guy's son from?
- ceeplusplus 4y ago
  Speculating on futures and other derivatives is basically what those rich guy's sons are doing in their hedge funds. Most hedge funds get worse returns than the S&P 500.
  - jtbayly 4y ago
    So... then let them? If they're losing money compared to what they could by doing nothing, I don't see the problem.
  - scatters 4y ago
    Getting worse returns than the S&P 500 is still valuable, if those returns are uncorrelated.
rsync 4y ago
"The bank in Margin Call was packaging MBS out of mortgages, not speculating on the price of commodities using derivatives to gain leverage." Correct. That's my point. It's not merely that you can't have one without the other ... it's that you very likely wouldn't want to eliminate the (margin call guys) even if you could.