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Ten Big Questions for JPMorgan

CNBC.com | May 11, 2012 | 04:05 AM EDT

JPMorgan Chase, the largest U.S. bank in terms of assets, revealed on Thursday that it suffered a trading loss of at least $2 billion from a what it described as a failed hedging strategy.

The news has sparked intense speculation about what caused the loss, how the bank's internal controls missed it coming, and how it will affect JPMorgan moving forward. As famed investor Dennis Gartman told CNBC on Friday, "when ill news comes out, there is usually more ill news to follow.”

As details emerge about the loss, a series of questions come to mind:

Is the loss-making position still open?

Have any of the losses been crystallized yet? If not, how big is the open position?

When did it become apparent to the risk department at JPMorgan that the "hedge" wasn’t working?

When were senior management and JPMorgan CEO Jamie Dimon informed about the magnitude of the potential losses?

What is the client position being "hedged"?

By how much did the original JPMorgan positional hedge offset the client portfolio position?

JPMorgan reported first-quarter numbers in mid-April. Should the bank have informed investors of a material risk to future profits if this position had already started to become a problem for the bank?

When was the "mark to market" calculation that revealed the loss made? Don’t investment banks make such calculations on a daily basis in order to ensure the position doesn’t become too prominent?

Was this a single trader acting alone? Or was it a desk trading a position that was made with full knowledge of senior JPMorgan and risk management?

What is JPMorgan’s interpretation of "proprietary trading" as opposed to "client position hedging"?

- By CNBC’s Stephen Sedgwick. Ted Kemp contributed to this story.