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Old 03-08-2011, 11:30 AM
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Originally Posted by Unregistered View Post
you serious? Advising clients to have 50% gain is quite impossible esp now where the banks are not extending much leverage to the client. Plus these days, clients are in risk avoidance mode, no more accumlator structures, no more structured finance stuff. how to make money without taking risk or leverage? good old days are gone, that is why CS and UBS are cutting staff as their revenues are not increasing as fast as salary compensations as their churn rate is getting lower....

anyway, if you can make 50% for client, you are actually better off running your own hedge fund.
I think you are mistake , leverage up 50% is not the same as gain 50%.
But leverage can up your % of return. You want the magic of leverage, I will show you

Buy bond 10 year, pays, 6%
Take leverage 1 month at 1.5%
Increase return 4.5%

Assuming 1 M
1M earns 6% (60000)
0.5M leverage earns 4.5 % (22500)
total earn 85000 for client or 8.5%

RM earns on income from bond AND leverage income.

Dont jump the gun before understanding leverage. If so, banking business is not for you.

As for the banker who proclaim you churn. Well. its a matter of surviving in the business. Sure you have to meet your target. But if you can meet it once and not ever again as a result of churning, where will you be in 3 years time?

ans : Another bank.
There are more products out there that are not necessary churning. Ie insurance, SBLC and if you are in the super league, IPO and big ticket loan items. All these will provide you the revenue you need.

In this business (private banking)its about working smart, not necessary working hard.
A true blue private Banker is unlike a priority banker.

Just trying to give a different pespective of Private banking

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