Understanding Trends In Banks' Trading Revenues

Notably, trading revenues increased year-on-year for the first time in Q3 2014 after falling notably in each of the previous four quarters. This is due to two primary reasons: an overall reduction in trading activity over the period, a temporary factor, and a reduction in total market size as a direct result of stricter regulations, which is a permanent factor. While trading revenues are likely to pick up early next year as the Fed hikes benchmark interest rates, the lasting impact of tighter re...