"A market maker is merely a prop desk running a particulra strategy. They have no information on Goldman's clients. They behave exactly like any hedge fund."
The common understanding is that a market maker is not exactly a prop desk. The clients of a market maker are the counterparties who take the other side of the market maker's markets. (These counterparties are Goldman clients). Market makers are not hedge funds and don't fundamentally behave like hedge funds, though I suppose both during their line of work take views on markets, so there are some similarities.
My point was, market makers, by definition, know what (their) clients are doing and take market views based on this. The major value in being a market maker (which is a huge part of Goldman's capital markets business) is seeing client flow.
The common understanding is that a market maker is not exactly a prop desk. The clients of a market maker are the counterparties who take the other side of the market maker's markets. (These counterparties are Goldman clients). Market makers are not hedge funds and don't fundamentally behave like hedge funds, though I suppose both during their line of work take views on markets, so there are some similarities.
My point was, market makers, by definition, know what (their) clients are doing and take market views based on this. The major value in being a market maker (which is a huge part of Goldman's capital markets business) is seeing client flow.
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