The purpose of this blog is to track 20 common stocks for a full year. The idea is to beat the S & P 500 like a mutual fund without the very high churn rate. These stocks will be held in a portfolio until next December 31.

Thursday, June 28, 2012

Toot your own horn when you can....

On May 18th I wrote. (Referring to JPMorgan.)

"  I think the trading losses will spread to $5B."

Today this story is released...http://www.ft.com/cms/s/0/fc973b58-c129-11e1-8179-00144feabdc0.html#axzz1z7GUt1Vj

"JPMorgan Chase is expected to announce losses of about $5bn related to trades by the so-called London whale at its second-quarter earnings presentation in two weeks."

There should be no mistaking what was originally called a hedge as a proprietary trade.
 A hedge is designed to protect against losses not increase them. Hedges are sunk costs designed to mitigate risk. The cost is known. There are hedges that increase opportunity costs, but that is not the same thing as loss.
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