Deutsche Bank €5.9 Billion forex proft in 2008
Does anyone have knowledge they can share on the DB (C. Bittar trader) fx trades made in 2008? I haven't found much on the topic on here, and think it's a worthy subject to delve into given the level of risk and consequence it had on DB.
What was the strategy and logic behind the trades and could it be repeated in the future? Forgive my ignorance.
They weren't FX trades, most likely...
Rumoured to have made nearly €2bn in audited profits for Deutsche Bank over a five year period, partly by betting that the cost of borrowing in euros for three and six months would rise more quickly than one-month rates, something that paid-off amply when Lehman Brothers collapsed.
Got it - what instrument do banks use to bet on borrowing costs?? (currently reflecting back to when I sold my finance textbooks for pennies on the dollar)
There's also the "rigging"; I'm assuming they were fined because their massive position simply moved the markets in their favor, not because they actually did anything wrong.
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