Famous options stories

[TrailerParkTed]

Who was the broker who used options and turned his sister, mom’s and his accounts in to millions on Black Monday 1987 using like $40k?



I thought it was Mark Cook, it’s not him. Old Market Wizard interview. Sister and Mom was like $2m, his he later revealed $30?

 

[ETJ]

 

[arbs-r-us]

First Options was owned by Continental Bank. The story I thought you may have been talking about was when a trader in 1987 (who cleared First Options, something Lee?) sold a boat load of puts in the OEX and almost took them both out.

Taiwan Haiwan Lee!!!!!

 

[Amun Ra]

"[...] a trader spent $53,000 buying a large number of call options that were extremely cheap, since they were so far out-of-the-money that other traders thought it was very unlikely that they would ever hold intrinsic value. However, these options had an expiration date far in the future, and two years later the underlying GameStop shares spiked in value, putting the options in-the-money, which the trader was able to exercise for $48 million. [...]"
https://en.wikipedia.org/wiki/Intrinsic_value_(finance)#Options

I remember a few years back there was this guy on wallstreetbets that had bought 11 1/21 $420 TSLA calls in around june or july of 2019. He paid $8 each for them so he was in for like $9k. It was such an insane bet because at the time because I believe TSLA was trading sub $200. A few months later TSLA gets to like $410 and he cashed out and made $70k and we're like "wow, what a lucky bet" But then TSLA continued to skyrocket. Had he held to expiration, that original $9k would've been worth about $4.3 million.

 

[TheDawn]

Now that they've shown their willingness to changes the rules mid game, is it really even worth playing?

I have two examples in mind:
1) The London nickel nonsense
https://www.reuters.com/business/lo...nickel-trades-after-price-doubles-2022-03-08/

The London's Metal Exchange is owned by the CCP so rule changes in mid-game should be expected.

2) The GameStop apparent Citadel-DTCC-retail broker collusion.

That happening in a western democractic country that founded market economy is quite disturbing. And the inquiry afterwards resulted in no action. The only comforting thought about this is RobinHood has not done well ever since the manipulation.

 

[carson_volsignals]

Rules change mid-game in the US all the time. It's the only way to maintain a shell game where the ledger rarely "truly" balances net/net.

Just ask any dealer-

Market strain? "We're going to need you to post additional margin against this inventory, here"

"We're going to need you to post additional margin against your net notional..."

"We're going to need you to close that, anyways"