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Non-Tech : Meet Gene, a NASDAQ Market Maker -- Ignore unavailable to you. Want to Upgrade?

To: Robert Cohen who wrote (1105)	9/27/2000 4:35:51 PM
From: LPS5	Read Replies (1) \| Respond to of 1426

In my experience, anything over the risk allotted per trader would have to be approved by a desk head if "on the fly;" each individual running a desk has some limited power to allocate additional capital - though not much, and there are of course checks and balances. If the concept is to assume larger risk in anticipation of some market turn or event in the coming days/weeks/months, the risk committee would hear a head traders' presentation and appeal - of which the underlying reasoning is a crucial factor - for greater departmental or unit financing. But the most interesting (some might opine humorous) scenario - this I've only heard accounts of at several large firm - is when a historically great trader takes on a position that goes against him. Rather than wack out of it, typically the trader will face a tribunal several times a week with reasons, statistical evidence, and contingency plans pertaining to his wounded position. Basically, he has to regularly justify the reason for keeping the transaction on, and - if the loss grows to a certain point or his reasons atrophy - the company may flatten the position. LPS5