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Deutsche Bank Said to Lose Money on Risk-Management Trades

  • U.S. equity central risk book said hurt by algo performance
  • Book size once topped $2 billion; trader moved to other role
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Deutsche Bank AG, the troubled German lender, sought to minimize risk at its U.S. equities business. Instead, the bet ended up in the red.

Traders in New York pooled billions of dollars of positions into one portfolio, known as a central risk book, in an attempt to avert losses and potentially make more money, people familiar with the strategy said. Yet the wagers stumbled, leading to a $60 million loss this year, said the people, who asked not to be identified because the details are private.