Morgan Stanley Widens Equities Trading Lead Over Goldman

Morgan Stanley’s revenue from equities trading beat Goldman Sachs Group Inc.’s for a third-straight quarter and by the widest margin since at least three years.

The attached chart shows Morgan Stanley’s revenue from that business, led by Ted Pick, was 22 percent greater than at its rival. That’s the most since Goldman Sachs began disclosing in 2011 how much of the unit’s earnings come from reinsurance, which is excluded for the comparison. Goldman Sachs had dominated in equities for years until Morgan Stanley snapped the streak in last year’s second quarter.

Wall Street firms have grappled with a slump in trading volume and volatility most of this year. Goldman Sachs Chief Financial Officer Harvey Schwartz told analysts yesterday that the firm “couldn’t feel better” about the strength of its trading business during those times and that quarter-to-quarter swings relative to competitors are “not a big issue for us.”

Goldman Sachs’s third-quarter equities revenue slid 11 percent from a year earlier to $1.46 billion. Morgan Stanley said today that its revenue rose 4.3 percent to $1.78 billion. Figures from the New York-based firms exclude accounting gains and the benefit of extinguishing debt.

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