securities trading in biglaw Forum

[Anonymous User]

So obviously we can't buy/sell equities and options.

We can buy ETFs.

What about ETNs? Are those fair game? FWIW my firm is silent as to ETNs but wanted to see if any one else had firms that state rules relating to ETNs

[Anonymous User]

Secondly - does anyone's firms have any strict guidelines about pattern day trading? I've been a PDT for 6 months or so now and while I don't see any rules against it I wonder if anyone has had any relevant experience. I assume it's fine if you're only trading ETFs

[Anonymous User]

Never worked in a law firm, but surprising that they're so strict since when I worked in a dealing room we could even buy stocks as long as they were approved and we held on at least 30 days.

Your firm's guidelines should be clear if there's any regulations against frequent trading. If there's nothing about ETNs, you'd probably be good to go, especially if ETFs are permitted. The point of allowing ETFs, but not stocks/bonds, is that you're unlikely to come across privileged information at work that would allow you some big insight into what, for example, the price of oil will do, but you could become privy to material non-public information about a company with publicly-traded equity/debt...this isn't really a concern with ETNs either. If you have any questions, why don't you just ask compliance?

[2014]

So obviously we can't buy/sell equities and options.

We can buy ETFs.

What about ETNs? Are those fair game? FWIW my firm is silent as to ETNs but wanted to see if any one else had firms that state rules relating to ETNs

Do you have a person/department you would go to for pre-approval if you wanted to buy or sell individual shares? If so, I'd just ask that person, surely they will know.

[r6_philly]

Some firms have holding period requirements for allowed securities so short term trading is not allowed.

[UVAIce]

It's all firm specific. Some firms have a list of companies you just can't trade in, some have holding requirements, some have no trading periods, and the list goes on. Probably a decent interview question to ask.

And if ETFs are allowed then I don't know why you couldn't trade options on the ETFs. All these rules are there to keep you from getting smashed for insider trading.

[84651846190]

index funds

[UVAIce]

So obviously we can't buy/sell equities and options.

We can buy ETFs.

What about ETNs? Are those fair game? FWIW my firm is silent as to ETNs but wanted to see if any one else had firms that state rules relating to ETNs

Oh, and ETNs should not be an issue. I mean they're just securitized debt instruments. I'm not entirely certain how there would be any information issues given that they are set to track an index.

[84651846190]

also, don't most ETNs have horrible expense ratios (at or near 1%)?

[UVAIce]

also, don't most ETNs have horrible expense ratios (at or near 1%)?

Yeah, but how else am I going to get inverse exposure to the 10 year T-Bill yield?

[r6_philly]

It's all firm specific. Some firms have a list of companies you just can't trade in, some have holding requirements, some have no trading periods, and the list goes on. Probably a decent interview question to ask.

And if ETFs are allowed then I don't know why you couldn't trade options on the ETFs. All these rules are there to keep you from getting smashed for insider trading.

My firm has a rule against all derivatives.

[84651846190]

also, don't most ETNs have horrible expense ratios (at or near 1%)?

Yeah, but how else am I going to get inverse exposure to the 10 year T-Bill yield?

IDK, man. My time is too valuable at this point for me to put in the time necessary to plan investment strategies that can beat my strategy of buying and holding shares of index funds.

[UVAIce]

also, don't most ETNs have horrible expense ratios (at or near 1%)?

Yeah, but how else am I going to get inverse exposure to the 10 year T-Bill yield?

IDK, man. My time is too valuable at this point for me to put in the time necessary to plan investment strategies that can beat my strategy of buying and holding shares of index funds.

Even if you did you would probably still be better off in an index fund. There are so many ETFs out there that you can create an interesting risk profile if you wan to. In the end you're probably still better off in the most unexciting index funds.

[Anonymous User]

Thanks for responses - OP here.

To follow up on why I don't want to reach out, our "compliance" for securities is a couple of partners and a few of which I work closely with (so don't want to be like uhhh I make over 50 trades a day, etc.)

As to why I don't do ETFs or more vanilla ETFs for that matter, I've been a pattern day trader for a while and while it's mostly for fun I make a nice side income as well.

[84651846190]

As to why I don't do ETFs or more vanilla ETFs for that matter, I've been a pattern day trader for a while and while it's mostly for fun I make a nice side income as well.

LOL. If this is really true, you should quit whatever other jobs/hobbies you have and start a hedge fund.

[Anonymous User]

As to why I don't do ETFs or more vanilla ETFs for that matter, I've been a pattern day trader for a while and while it's mostly for fun I make a nice side income as well.

LOL. If this is really true, you should quit whatever other jobs/hobbies you have and start a hedge fund.

Nah breh you don't understand how day trading works. Just cause you make some paper for a few years doesn't mean it's stable. Just on the side - I wouldn't want to do this long term simply because you never know when your reads go bad or hit a downturn. Some months I'll put dozens of hours into it and lose 5-10k. Gotta have a stable income too little breh