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Will Business Investment See Upturn in 2012?

By Robert Karofsky

Business analysts expect investment in new equipment and buildings to pick up in the second half of 2012, according to a report on Kiplinger.com. The trend is expected to gain steam amid improved job creation and overall growth as compared to the first six months of the year.

Overall, business investment should grow an annual rate of 8 percent in the last two quarters of 2012, as opposed to just 3 percent during the months of January through June.

An early sign of the coming uptick came in May when new orders for durable goods rose by 1.1 percent. Analysts expect overall orders of durable goods to increase by approximately 10 percent for the year. Orders for autos, steel products, and airliners should lead the trend.

Most economists expect inventories to remain relatively unchanged by the end of the year, as businesses seek to balance inventory levels with sales.

About Robert Karofsky: A respected financial services executive, Robert Karofsky holds an MBA from the University of Chicago Booth School of Business.

Volatility Swept Across U.S. Equities Late Summer 2011

During the second week of August 2011, the Dow Jones Industrial Average plummeted hundreds of points and VIX volatility indexes reached alarming highs, but liquidity retained its strength during lessened but still strong trade volume. There was little difficulty filling clients’ orders.

Robert Karofsky, global head of equity trading for AllianceBernstein, was quoted in the August 11, 2011, Traders Magazine Online News with the observation that, while the markets’ price action was unnerving, they “are absolutely functioning efficiently.” Karofsky continued to note that the lack of delays and disruptions was a positive indication.

Further explaining, Karofsky pointed out that when a large burden presents in the system, increased correlation occurs in the marketplace because stocks move together, and therefore investors were being particularly drawn to exchange traded funds (ETFs). Karofsky recognized that normally ETFs are about 30 to 35 percent of trading’s daily volume, but recently that number had grown to approximately 40 to 50 percent.

Hobart and William Smith Graduate Reflects on Career

Like most college graduates, Robert Karofsky was driven by a desire to succeed. What separates him from his peers? The skill set to back up his aspirations with action. After graduating from Hobart and William Smith Colleges, renowned for the high quality of their educational programs, he entered the equity trading industry by accepting a position at Morgan Stanley.

Fourteen years later, Karofsky and a team of other Morgan Stanley experts decided to spread their wings and seek new opportunities. To the delight of Deutsche Bank Securities, Karofsky accepted the position of Managing Director, Global Head of Program Trading & Direct Markets Access. Deutsche Bank’s Head of Global Markets, Anshu Jain, described him as a professional, and the company labeled Karofsky and his team the personification of “commitment to clients, excellence in risk management and innovation,” values that Deutsche considers pillars that support its market leadership strategies.

In early 2010, Karofsky, a number of his constituents, and numerous Deutsche Bank clients banded together to raise more than $4 million donated toward Haiti relief efforts. He considers the fundraising effort’s huge success one of the landmark moments in his career, saying he was “extremely gratified to partner with our clients to address the urgent needs of the Haitian people.”

Robert Karofsky and Research-Driven AllianceBernstein

With more than a decade of experience on Wall Street with Morgan Stanley and Deutsche Bank, Robert Karofsky has served as Global Head of Equity Trading at AllianceBernstein, LP, since May 2011. Managing more than $400 billion in assets, the New York-based investment company maintains a uniquely global outlook as a part of the French insurance conglomerate The AXA Group.

AllianceBernstein offers corporate, institutional, and retail investors a uniquely research-driven value proposition. The firm’s research capacities encompass economic analysis, currency forecasting, and fundamental research. Its extensive team of quantitative analysts builds focused asset allocation and risk-and-return models, creating custom and packaged solutions that meet a diverse range of customer needs. The company notably generated positive media attention in 2010 for innovative risk-parity strategies on pension holdings designed to minimize volatility and maximize returns.

One of AllianceBernstein’s key assets is its high level of perceived integrity. The firm was listed at the top of Forbes’ “10 Most Trustworthy U.S. Companies” list in 2007. Two years later, at the height of the global financial crisis, the company was one of three asset-management firms enlisted by the U.S. government to manage and value TARP funds. Robert Karofsky’s trading strategy with AllianceBernstein combines continuous market research with judicious costs-and-benefits analyses that allow the firm to achieve optimal client results.

New Hire for Deutsche Bank Specializes in Trading Algorithms

Robert Karofsky, Deutsche Bank’s Co-Head of Global Markets Equity, is proud to announce the hiring of Jose Marques as Managing Director and Head of Equity Electronic Trading for the bank’s Global Markets Division. Marques was formerly employed by Credit Suisse in the Advanced Execution Services Group. Electronic trading is a rapidly growing aspect of the market and is an increasing focus at Deutsche Bank as it works to become a market leader in this aspect.

With more advanced electronic trading algorithms, the choice of whether to use a human trader or make an electronic trade is becoming an increasing issue in the financial world. Suddenly, buy-side firms can bypass dealings with sell-side firms and make automated trades on their own. New algorithms make this process quicker, more efficient, and eliminates a possible conflict of interest with the brokers on the sell side. “We are more inclined to go down the electronic route when we don’t think a human can add value by finding a creative solution to a particular trade,” states Robert Karofsky.

The Migration of Morgan Stanley Executives to Deutsche Bank AG

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In 2005, 14-year Morgan Stanley veteran Robert Karofsky joined Deutsche Bank AG in a move reported upon by the New York Times. While at Morgan Stanley, Karofsky functioned as Managing Director and U.S. Head of Cash Equity Trading. Deutsche Bank AG chose him to perform as Global Head of Program Trading, Global Head of Direct Markets Access, and the Co-Head of Cash Equities Strategy in America.

Appreciative of Robert Karofsky’s talents and experience, Anshu Jain, Head of Global Markets and a Member of the Group Executive Committee for Deutsche Bank AG, explained that “commitment to clients, excellence in risk management and innovation have been pillars of Global Markets’ strategy.” She added that “Robert and his team share these values. They will be integral to our ongoing drive to achieve market leadership in North America and in cash equities globally.”

Robert Karofsky was not the only executive to leave Morgan Stanley during this period. Along with Karofsky, Deutsche Bank AG hired former Morgan Stanley employees Eric Shenker, Brian Dugan, and Brian Rigney, among others.

The Haitian Relief Efforts of Deutsche Bank AG

Following the devastating Haitian earthquake of January 2010, Deutsche Bank AG aided the country as it recovered from the damage. On January 15, the firm announced that 100 percent of its Global Markets Equity group’s net U.S. agency commissions for one day would go toward relief and rebuilding efforts. Moreover, Deutsche Bank AG promised unlimited matching gifts from the money raised through the Deutsche Bank Americas Foundation’s Matching Gifts Foundation. This endeavor received positive feedback from the bank’s clients and staff.

The company joined with AmeriCares, Doctors without Borders, and Partners in Health to provide emergency assistance to deal with the immediate aftermath. Concerned with the nation’s long-term solutions, the firm united with Habitat for Humanity International, Fondation Connaissance et Liberté, and other groups that offered guidance in re-establishing communities, creating jobs, and building houses.

During this program, Robert Karofsky was acting as Co-Head of Global Markets Equity at Deutsche Bank AG. In a 2010 interview, he expressed his gratitude to employees and clients who helped fund a far-reaching, long-lasting recovery effort. Today, Robert Karofsky serves as the Global Head of Equity Trading at AllianceBernstein L.P.

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