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Trump Rally Enriches Goldman Partners

November 23, 2016

No need to wait for holiday bonuses due out in 2017. Goldman Sachs partners held enough stock in the firm on November 9th to reap a more-than $800 million gain in the post-election stock market run-up. Shares of Goldman Sachs have advanced 17% since Trump’s victory. The paper windfall is based on figures in a regulatory filing late Wednesday showing how many shares the executives held the day after the vote, when Trump’s victory in the U.S. presidential race sent the stock soaring.

 

The filing underscores the huge profits in store for Wall Street executives if investors are right about the effects of Trump’s policies. His election sent shares of the biggest U.S. banks climbing on speculation he’ll dismantle regulation and boost long-term interest rates with inflationary spending, potentially burnishing profits for lenders.

 

Collectively, Goldman partners held a 6.69% stake in the company on 11/9/16 - down from 7.24% near the end of January, the last time the firm provided a snapshot of their holdings. The drop coincided with a decline in the number of partners in that period. Wednesday’s filing listed a total of 410 names, compared with 448 in January.

 

‘IN THE MONEY’ EXPIRING OPTIONS. The stock’s jump this month also triggered sizable gains for Goldman Sachs executives holding worthless options that had been granted at the end of 2006. A day before Americans voted, it looked like more than 1 million of the contracts held by top executives and directors would expire this week out of the money, meaning it wouldn’t make sense for executives to exercise them.

 

But after the stock jumped, they generated millions of dollars in additional profits. Within 10 days of the election, insiders at the bank sold more than $200 million of stock, company filings show. That’s 3 times more than the group sold in any month for at least 5ive years.