Trades and Products

Martin Walker

Every month I would go to Trade Working Group as the representative of my department. In spite of attending many meetings, I never really understood the ultimate objective of the group. The principle topic of conversation seemed to be the definition of a “trade”. A small group of “big hitters” would dominate the conversations by delivering forceful but ultimately purposeless monologues. I learnt the least painful course of action was simply to listen and not try to say too much. Every so often one of the members would reach a state of intellectual crisis and question the purpose of the meetings. “Why are we here? What are we trying to achieve?” Those meetings typically ended in slightly embarrassed silence. Eventually some of the big hitters decided the purpose of the meeting was to push their agenda for re-designing the bank’s trading infrastructure. So, I like many others drifted away and never came back.

– Operations manager at a major bank

This chapter will explain what trades in capital markets are, the key variations in meaning, why they come into being, what generally happens to them during the course of their existence, and closely related concepts. “Trade”, like

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