The first quarter of 2012 has been a successful one for Goldman Sachs Group, Inc. (NYSE:GS). The large investment bank has seen a huge increase in profits all thanks to the deriatives used by investors in Europe. It has increased by 8 percent from last year’s $476 million.
The real success behind the investments involved the measures used by individual investors, banks, and large companies. Such deriatives included fixed-income markets and hedge fund bets. It’s also important to note that in the past year, these acquired practices have significantly made up for the decreased use of more traditional investment methods. In the last year alone, clients frequent use of deriatives increased by 142 percent.
Chief Executive Richard Handler from Jefferies Group Incorporated recently spoke during a conference call to talk about the current quarter and here is what he said, “a number of larger foreign players who have had ambitions of being global are choosing to go back to their respective countries to basically satisfy their regulators and the rating agencies”
It is speculated that the regulators in Europe are trying to stabilize the stock market and that so far it appears to be a very successful plan. Perhaps this also takes some of the burden off U.S. financial programs and companies who may be less like to make such investments due to the rocky economic conditions.
Goldman Sachs did not report the actual numbers of Europe’s results as an individual nation. They did, however, release their numbers along with the number from the Middle East and Asia. They reportedly earned $2.87 billion in finances and an additional in $1.09 billion in pre-tax revenue just within 2011’s first quarter. The representative for Goldman, Michael DuVally, did not comment.
It’s a relief to know that companies like Goldman Sachs can still earn a significant amount of money even in rough economic periods.