In 2008 the hedge fund Cohodes worked at for more than two decades went out of business under controversial circumstances.
He maintains that Goldman Sachs, its prime broker, closed it too hastily by making needless margin calls, a claim Goldman disputes.
must be executed at the following day's closing price, but because some orders placed before p.m.
cannot be executed until after p.m., brokers can collude with investors and submit post- p.m. Such trades can be made with information about after-hours market developments in other countries, for example.
According to the lawsuit, the perpetrators carried out the scam by creating a fake email address that resembled that of one of the company’s vendors in Asia.
While this information is believed to be reliable, such reliability cannot be guaranteed.
Traders would buy in at the previous day's close, and sell at the next day's close for a likely profit.
This practice hurt long-term buy-and-hold investors in the mutual fund, who experienced a continued drain in the fund's net asset value. Prior to 1968, most mutual funds used "backward pricing," in which the fund could be bought at the previous closing price.
Six pinball machines, a gigantic flatscreen, and a pingpong table compete for attention.
If not for the Bloomberg terminal in the corner, you might assume this was your typical man cave.