"Black edge" at issue in SAC Capital case
At SAC Capital, the term "black edge" apparently means information that is rock solid and very proprietary, the kind of information that can result in profitable trades that generate hundreds of millions of dollars.
As an arresting article from Bloomberg Businessweek makes clear, the term "edge" is used elsewhere in the industry, notably at Galleon, where it signified proprietary information that was thought to be the lifeblood of traders.
But "black edge" may be somewhat proprietary to the SAC Capital crowd.
In a sea of media coverage, the Bloomberg article stands out as a definitive look at what's at stake for the firm, as Mathew Martoma prepares for trial.
It notes that, "[Martoma] persuaded Cohen, one of the most sophisticated investors in the world, to do just what Munno and Slate had been advocating—drop a $700 million long position in Elan and Wyeth. Martoma furthermore persuaded his boss to short both stocks to the tune of hundreds of millions more. It was a billion-dollar trading swing that led to enormous profits and avoided losses."
There is still a chance that Martoma will strike a deal with prosecutors. If not, this trial could be the most fascinating development yet. It will likely not play to Cohen's advantage. If Martoma doesn't flip, you have to question whether insider trading charges will ever be filed against Cohen.
- here's the article
Ex-SAC Capital manager cooperates with feds
SAC Capital: First in profitability and controversy
Mathew Martoma will not turn on Steven Cohen
SAC Capital probe expands
SAC Capital remains elusive target for Feds