Rogue*

Rogue trading is all very well but, honestly, the risk-reward profile is not ideal. You know how it works: you're a trader, tired of making profits for your employer and you feel like you've been locked out of heaven, financially-speaking. In short, you want a much bigger personal stake in the whole thing.

Problem is, as a mere salaried desk jockey, you don't have any real money. So, one day you use cash that was entrusted to you by your employer or a client to trade on your own account. To wit: you enter the market with someone else's dough. If it all works out, you return the stake and pocket the profit. Yeay! Here's you, all 🎵New Money, suit and tie.🎵** Trouble is, if the plan crashes and burns, you find yourself in a bit of a pickle trying to explain what you did with the municipal workers' retirement fund, or whatevs. Long-short, if the gamble doesn't pay off, you're out of a job and spending way too much time with the securities regulator. You may even get a visit from the Heavies—and all for returns that are probably no better than the market average.

What you need in these circumstances is Enhanced RT. Rogue trading on inside information. That's the kind of thing that can skew your risk reward profile, in a good way. Let's say you receive a client's instruction for big purchase order. A price movement in the stock is now a Dead Cert, so you can carry out a bit of alt-funded front-running and burnish the lustre of your rogue trading with the certainty of profit. Kapow! Now you're cooking with gas. Only problem is, you've broken quite a lot of rules, you're still at the mercy of adverse market movements and your gain is just an incremental price increase driven by someone else's stock purchase. I dunno, Dude--seems like you could do better.

Hmm. Do you know what might really improve your prospects here?

What if you were to get a job trading in-house at a central bank?

Oh yeah!

Think about it for a second. In-house at a central bank, you've got access to a Lorra Lorra Lolly and a shedload of market sensitive information. Maybe, you don't personally get to see the Monetary Policy prep documents but you can probably set eyes on them with a little bit of Machiavellian networking and, anyway, your client is: The. Central. Bank. You'll be front-running billions! Oh, Baby! If you ask me Central Bank Insider Rogue Trading is where it's at.

What's that? Security? Surveillance?

Death penalty???! *Gulp* 😟

Oh, I see. You're joking...sort of. Ha. Very Ha.

*Harrumph*. But ok, let's not throw this baby out. C'mon there must be a tweak that could save such a promising proposition.

Let's say, maybe...

• you're not actually a trader, just a bod with access who knows a trader

• you take money out of fee receipts or invoices, not reserves

• you keep it all under the tax radar

• you tell everyone you're shifting money around to meet bank liabilities (it's an accounting matter, y'know)

• if suspected, you summon up all that central banker gravitas and stonewall the investigators

• if accused, you insist it's a matter of financial stability and national reputation so...hush, hush.

Eh, eh, eh? Admit it...I'm on to something here. Joey Perks has still got it, after all.

What's that? You're an upstanding citizen who balks at doing something so wholly contrary to the national interest?

*Sigh* Yes, well, maybe you're right. It's probably just simpler to keep hammering away at your Robinhood account after work—at least until they ban everything.

* Satire, at best... or maybe homage (here's a recent newsletter by Matt Levine on the SEC rogue trading enforcement case).

** Songwriters: Taylor Swift / Martin Max / Johan Shellback. Blank Space lyrics © Sony/atv Tree Publishing, Taylor Swift Music, Mxm Music Ab