TRADING AND PRINCIPAL INVESTMENTS
Our Trading and Principal Investments business facilitates customer
transactions and takes proprietary positions through market making in,
and trading of, fixed income and equity products, currencies,
commodities, and swaps and other derivatives. In addition, we engage in
floor-based and electronic market making as a specialist on U.S.
equities and options exchanges.
Our Trading and Principal Investments activities are divided into three
categories: Fixed Income, Currency and Commodities, Equities and
Fixed Income, Currency and Commodities (FICC)
FICC makes markets in and trades interest rate and credit products,
currencies and commodities, structures and enters into a wide variety of
derivative transactions, and engages in proprietary trading. FICC's
principal products are: commodities and commodity derivatives; credit
products, including investment-grade corporate securities, high-yield
securities, bank loans, municipal securities, credit derivatives and
emerging market debt; currencies and currency derivatives; interest rate
products, including interest rate derivatives and global government
securities; money market instruments; and mortgage-backed securities and
Equities makes markets in, acts as a specialist for, and trades equities
and equity-related products, structures and enters into equity
derivative transactions, and engages in proprietary trading. As an agent
and market maker, we facilitate customer transactions, often by
committing capital, to provide liquidity to clients with large blocks of
stocks or options.
Principal Investments primarily represents net revenues from our
merchant banking investments. We make principal investments directly and
through funds that we raise and manage.