The Rogue Trader Theory of Markets

I have this theory that every market must have a rogue trader before we can say it’s truly crossed over into popular consciousness. it speaks to market liquidity and size, crossed with popular awareness. It happened in commodities, oil, derivatives, currencies, etc., and it has now  happened in carbon credits:

A TINY London trading firm is at the centre of a shadowy chain of international deals involving the carbon market’s first “rogue trader”.

A mystery investor made a £1.8m profit last week by selling invalid carbon permits to unwitting buyers in Europe — which caused a temporary trading freeze at two of the main carbon trading exchanges.

Microdyne, a firm registered in Cyprus but based in Edgware, northwest London, confirmed this weekend that it bought and sold the permits to the mystery trader.

Bluenext, the exchange where the permits were sold has launched an investigation.

More here.

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  2. Brian Hunter: Rogue or Not?
  3. Henry Paulson: Rogue Treasury Trader?
  4. Random Rogue Trader Question
  5. Rogue Traders, Knave Traders, and the Subprime Blame Game