Goldman Sachs is withholding stock tips from the thousands of clients who receive the company's written research reports until days after they're passed along to the firm's own traders and some 50 favorite clients, the Wall Street Journal has learned from an analysis of company documents. Confidential “trading huddles” are held weekly for traders, who then pass them on to key clients, while most investors lose the opportunity to trade on them.
Goldman says that no one unfairly benefits from the trading huddles, because they focus on short-term trading ideas that individual investors wouldn’t be interested in, rather than longer-term forecasts included in written research. But individuals often disagree. “When I joined Goldman as a client, I got all these fancy brochures saying they put the client first,” complained one investor. “I was at the end of the food chain.”