Schadenfreude Warning: "Karen the Supertrader"

ScalperJoe said:
Agreed, the SEC isn't likely going to forward the case to the U.S. Attorney for criminal prosecution. Other than permanently barring her from further securities violations, The SEC is asking for relief through monetary penalties. (See complaint at page 32 and 33).
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I can only hope they do criminally prosecute her in time. If she loses her SEC case I assume that the clients can go after her in a civil suit as well? I am not familiar with the law in that regard.

I don't know why she would think she would get away with it.
 
I believe Maverick74 did a fine job articulating my feelings.

It was quite clear that she was over leveraged, if you had been following her story. Regardless of your opinion on being short far OTM gamma convexity, her downfall was her accounting practices.

0.02 cent: if you're short vol, learn to take long vol positions. And vice versa.
 
I guess the part we'll never know about is, before the fund was setup, were all of her personal trading profits (from memory, like 40 mil, right?) actually real? I remember when I saw the first vid of her, I was thinking, "Why start a fund? You won...100% retirement on the after-tax 40 mil!".
 
@SteveH, it's likely it was real because her books were probably scrutinized at one point in time. But that doesn't mean much, she got lucky by using the exactly right trading method for the period in question, it's likely she didn't know she got lucky because of her background. I'm not the old school but I have more market experience than she does and I'm not trading millions. It's the old mistake of confusing luck with skill.
Her company was called Hope Advisors after all, there's a clue right there.
 
Chubbly said:
I can only hope they do criminally prosecute her in time. If she loses her SEC case I assume that the clients can go after her in a civil suit as well? I am not familiar with the law in that regard.

I don't know why she would think she would get away with it.
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Don't bet on a criminal prosecution, however anything is possible. I'm not sure either regarding the clients going after her in a civil suit. According to the complaint, the SEC just wants money, and her investors will probably make claims from the restitution fund.

Ya, I see your point regarding how "she would think she would get away with it." Until she provides her defense, there's simply no way to know what went through her mind. It's quite possible she settles without admitting or denying the charges, and it's business as usual for the SEC.
 
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Windlesham1 said:
Remember Victor Neiderhoffer anyone- dickheads selling naked puts deserve to get their butts kicked-blind arrogance
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Tell it to Tony Caine from LJM, who have been doing it for over 12 years managing 100s of millions. He is doing just fine. Not all naked options selling is equal.
 
RedDuke said:
Tell it to Tony Caine from LJM, who have been doing it for over 12 years managing 100s of millions. He is doing just fine. Not all naked options selling is equal.
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Good outfit RedDuke. They are net premium sellers but not naked. That is the only way to sell premium IMO; they do hedge tail risk (buy some sort of wings).

"Additionally, LJM Funds must reinvest a portion of the premium or revenue generated in order to hedge against extreme events. LJM Funds enters into specific risk-mitigation trades in an effort to mitigate losses during extreme events. "
- See more at: http://www.ljmfunds.com/faqs


-gariki
 
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