Pair Trade: Long

Pair Trade: Long GS, Short JPM Fundamental Commentary The Goldman Sachs Group, Inc. (GS) The Goldman Sachs Group, Inc., a bank holding company, is a global investment banking and securities firm specializing in investing banking, trading an principal investments, asset management and securities services. The Company provides services to corporations, financial institutions, governments, and high-net worth individuals. Yesterday Goldman announced that it had agreed to pay $550 million – the largest penalty ever imposed on an investment bank – to settle civil fraud charges over its incomplete disclosure to investors who lost billions of dollars as a result of collateralized debt obligations. The settlement resolves Goldman of all SEC inquiries into its conduct regarding the CDOs, including the fact that it failed to disclose that hedge fund manager John Paulson was on the short side of the same CDOs that Goldman was selling to its clients. The settlement also agrees that Goldman neither admits nor denies any wrongdoing in the matter. Nonetheless, Goldman has since acknowledged that they made a “mistake” and “regret” the disclosure omission. Analysts reactions to the settlement for the most part have been positive. On CNBC yesterday there were price targets given between $175 and $200. Here’s what Dick Bove had to say on CNBC yesterday: “I think that Goldman Sachs is one of the best companies ever created in the United States. It really understands its businesses and that it operates them properly. And if you believe that money supply over time constatnly goes higher–and money of course is the raw material of thsi company–then you have a company whose …

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Pair Trade: Long

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