This workout regarding the role of ECM versus the trading desk asks us to identify whether the following statements are true or false. The first statement says market making is always performed on an agency basis. This is a false statement. Market making will always be performed on a principle basis where the market maker trades using their own balance sheets. The next statement says ECM is primarily involved in the primary markets. This is a true statement.

The trading desk is primarily involved in the secondary markets. The next statement says trading desks are given significant advanced warning of block trades. This is typically a false statement. Often block trades are short notice trades, so will not come with long lead times.

The next statement says, there are no restrictions on the use of inside information on trading desks. That is a false statement. Trading desks should not have access to inside information, and if they do have access to it, they should not trade on the basis of it.

Finally, program trades are typically executed over an extended period. This is a false statement. Program trades involve the simultaneous execution of a large number of securities at the same time.