Goldman Sachs Sees Worst Q4 Trading in Close to a Decade

The firm lost money on 19 trading days, including one day which drained almost $100 million from the firm's coffers

With fourth-quarter reports for last year popping up across both the retail and institutional trading industries, it seems that traders did not have a good end to 2018. A case in point is Goldman Sachs.

According to Bloomberg, the investment banking giant’s trading teams saw their worst fourth quarter in almost a decade.

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A regulatory disclosure made by the firm on Tuesday indicates that the firm lost money on 19 days during the final three months of last year.

On one of those days, traders at the investment bank lost close to $100 million.

This was the highest number of loss-making days that the firm has seen since 2011 when it recorded 21 days of trading losses.

It also means that, as there are only usually 20 or 21 working days in a given month, Goldman Sachs’ traders saw almost an entire month of losses in the final quarter of 2018.

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For the first three quarters of the year, the firm saw only 12 days of trading losses.

Cuts to fixed income

End of year volatility, likely caused by ongoing Brexit negotiations and China-US trade talks, appear to have been responsible for the firm’s anomalous loss-making record.

Bloomberg said on Tuesday that the firm is planning to make changes to its fixed-income division to rectify the problems that it has been experiencing.

That is likely to result in personnel, and capital allocation cuts to the company’s fixed-income trading division.

Having said this, it wasn’t all bad for Goldman Sachs when we look at the year as a whole.

Just as volatility likely drove losses, it also appears to have led to some success for the firm.

In its report on Tuesday, Bloomberg said that the investment bank had 12 days over the course of last year when it made more than $100 million.

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