Why did Goldman miss first quarter earnings, while its competitors announced strong results with big gains from trading?
That was the big question asked by many investors last week and we're beginning to find out the reason.
Bloomberg News is reporting Goldman's bad quarter was because of wrong way bets on the bonds of a coal company, a utility, retailers and the U.S. dollar.
"The bank incurred tens of millions of dollars in losses on companies including Peabody Energy Corp. and Energy Future Holdings Corp. Borrowings from retailers including Rue 21 Inc., Gymboree Corp. and Claire's Stores Inc. also stung," the report said, citing people familiar.
Goldman's stock traded down 5 percent Apr. 18 after the firm reported the weak March quarter. The bank missed Wall Street expectations on both sales and earnings. It surprised investors as the company has beaten profit estimates 90 percent of the time historically, according to Bespoke Investment Group.
See here for the full Bloomberg News report.