gold, page-41680

@Fudley61

"I guess any minute we will get a chart showing the “24.7 to 1” leveraging comment is wrong."

Before I did that I would want to know more about the underlying data on which the claim is based. Most of these numbers assume "gross" derivative outstandings, which ignores netting and offsets and consequently massively overstates the risk.

I could easily construct a hypothetical derivatives position for a bank that has leverage of 50-1 or 100-1, based on gross contracts outstanding, that have less market risk than a position geared at 1-1.

In derivatives, gross numbers are meaningless. I was desk trader with a major for eight years and I only bothered to look at gross numbers once a year when I filed out the AFMA survey.