Optionsellers.com goes bust and the apology video is painful to watch

ZBZB said:
When shale gas came online NG had a massive downtrend. Look at the monthly chart on tradingview for 2008/2009. Went from 13.5 to 2.5. The winter/summer spread April/May led to a hedgefund wipeout on several Billion dollar losses. It is called the widowmaker spread.
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I went back and took a look and I can't say that was a "crash". Worst 10 day period from Jul 4 2008 was -13% whereas the up move from Nov 2 peaked at +50%.

I'm not here to debate what is the definition of a crash. One person's crash is simply volatility for another. My point is NG tail moves are skewed to the upside. Especially at $3.

Could it crash to the downside? Sure, but just because it's possible doesn't make it probable.
 
Everyone here talking about them being in front of Jury need to realize this: First off all their agreement could have had arbitration clause, so they would go in front of arbiter. And most importantly, did they do everything according to d doc? If they did, there is really no case. CTAs do not have fiduciary responsibly per se, they are responsible to trade according to disclosure document.
 
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Overnight said:
This is a terrible analogy.

I cannot even begin to spell out why this analogy is just off-the-mark and has nothing to do with trading, has ZERO comparison. Maybe you can if you think of it as being a car you are "conducting" (driving).

It just doesn't work on so many levels, heh.

P.S. 30 MPH speed limit vs. 79 MPH speed? That is almost triple the speed limit, not almost double. Double the speed limit was exceeded at 61 MPH.
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It's a good analogy. The conductor is responsible for the safety of his/her passengers and community while safely operating the train according to defined operating procedure. The money manager is primarily responsible for the safety of capital number one. Secondary objective in both cases is efficiency. For the conductor, it's getting the passengers to the destination by the due date. For the asset manager, it's achieving a "good" return or beating some benchmark. Give one reason why the analogy is "just off-the-mark". The analogy doesn't have to have anything to do with trading, that's the point. It's a demonstration of how the same principles apply outside the current focus.
 
GRULSTMRNN said:
Disagree. Same. Suicide, death penalty or life long sentence. There are things a human being especially adults, need to be cognicent about which is that certain violations can kill people. The end result is the same, whether you speed and kill people or whether you are drunk driving or are in other ways grossly negligent which costs peoples' lives. Speeding a train just above the limit is a different thing than racing at double the speed limit. A driver who races at 50 miles per hours through a 25 miles per hour speed limit zone and kills a child should in my opinion be seated on the electric chair. Judgment "not fit to live among the rest of society"
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I would rather lose all my money (due to my own bad idea of giving it all to one person to manage) than have someone else kill me in a train accident. Death is far worse than financial lose. I can recover from financial loss, I can't recover from death.

I agree with your last point about judgement not fit to live among rest of society.
 
This is exactly why I trade my own capital and not hand it over to someone who did not have to bust and sweat his ass off to earn. I hedge all my trades, manage risk like a hawk and will close out for a small loss to prevent big losses immediately. This guy was busy living the life, drinking his morning wine while listening to his audiophile setup and planning his day. He was not managing or worrying about his clients money jack shit. Totally wreckless and neglegent trading. Look I am not an award winning author from Harvard with degrees in this shit and I know not to do such a stupid trade.

He has no excuse for what he did and ignorance or "I did not expect this" is not an excuse. I would not be surprised if he was under the influence while trading. You dont trade intoxicated, thats like flying a plane on drugs.
 
prc117f said:
This is exactly why I trade my own capital and not hand it over to someone....
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But that is you, high net worth individuals and family offices have other occupations and allocate their wealth to various managers/programs.
 
prc117f said:
Did his clients see these spreadsheets? I guess it did not raise alarms for them.
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99.999999999999% of his clients won't understand them even if they saw the spreadsheets. That's why they let this guy trade their personal accounts via a POA in the first place.
 
GRULSTMRNN said:
Exactly and if he indeed loaded up on those tail shorts he should be held liable even with his personal assets down to the last gold crown in his wive's mouth. But his watch must go first :)
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Stop picking on this poor man's watch already!!! LOL
 
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