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Investment
Proprietary Trading Desk
A team inside a bank or hedge fund that trades the company's own capital to generate profit.
After the 2008 crisis, regulations (Volcker Rule) limited how much banks can do prop trading. Many banks spun off their prop desks or turned them into hedge funds. Today, independent prop firms have become very popular with retail traders.
It's the bank's personal betting table — they use the bank's money to try to beat the market.
Real world: Big banks like JPMorgan or Goldman Sachs have prop desks that trade bonds, currencies, commodities, and stocks using the bank's balance sheet. Profits go straight to the bank; losses are also the bank's problem.
💡 Proprietary trading desks are where banks gamble with their own money to make extra profit.