Commodity VaR Major Financial Institutions
In the midst of all the Obama proposal for restrictions on proprietary trading for commodities and other securities, it has been found via the data that financial institutions like Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and JPMorgan Chase (NYSE:JPM) have decreased their Value-at-Risk, or VaR, for commodities, by a minimum of 25 percent since their highs during the ongoing commodity surge in 2008.
That data is in reference to numbers crunched in the fourth quarter of 2009.
What VaR deals with is the confidence or willingness for a financial institution to trade in a particular market sector.
Even so, it's interesting that while the risk appetite seems to have declined some in the fourth quarter, commodities and currency investments helped some of the major financial institutions in America perform much better than they would have without those investments.
Volatile times right now will probably keep commodities in check for the short term, but almost every announcement one way or the other seems to push commodity prices in one direction or the other as uncertainty about true economic recovery, interest rates and what China will invest in commodities in 2010 has the commodity market skittish and seemingly all over the place.
Commodity VaR Major Financial Institutions
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