Victor Niederhoffer--- Rare Silver Auction Catalog

[Moneyball]

No one forced him to trade so much AUM. That's why a lot of funds close to new investors, stop taking new money altogether or even return some or all money to investors (even if they are performing well). A % return is a % return regardless of total AUM- if you don't have enough ideas to put that much money to work, or if your system isn't scalable to those amounts, then you shouldn't be trading with that much. Once you hit your levels of diminishing returns, it's time to slow down, not take on even more risk.

It's obvious he has a tremendous ego, which has probably contributed a great deal to his success but has also burned him multiple times. Who said you have to be the absolute best? Wouldn't most people be quite content being "only" in the top 1% of all traders, and not have to keep pressing until you're in the top .1%? Again, I'm sure he wouldn't have been as successful as he was without these traits, but there comes a point where it's no longer drive and determination, it's just plain reckless and irresponsible.

I just don't buy the "his investors demand such high levels of performance, that's why he took such extreme risks" argument. If he was uncomfortable taking such risks, he shouldn't have accepted the money to begin with. That's what I'd tell my personal friend, instead of looking at his career through rose colored glasses.

 

[taowave]

Quote from marketsurfer:

yes, well said, Rearden.

regards,

surf

Surf,you left out this lil snippet,and sadly this little comment tells all one needs to know.

He was simply way overleveraged... by at least 250%, IMO.
I think he knew it was a mistake on an intellectual level, but let his emotions override his better judgment.

Surf,IMHO Vic was overleveraged much closer to 400% and he suffered the same death that every premium seller does sooner or later.What is sad is the fact that this was at least Vics second implosion,and he appears to perish the same way.He is flawed as a trader,and his charm,genius and brilliance somehow blinds his loyal following.

I honestly can not think of another major proprietary trader who trades in the same manner that Vic does.If you were a derivative trader,you would immediately see his folly....

 

[taowave]

Quote from marketsurfer:

your point is taken, rm. however, i believe there was more to this situation than meets the eye. were not the margin requirments increased multiple times while VN was in the positions with huge size rendering a prompt exit impossible? i am not familiar with exchange rules, but it seems odd to me.

would there be another way for him to return the gains DEMANDED by the investors without submitting himself to the extraordinary size/risk?

just speculating again, but it appears to me that there were layers of risk controls and management in place indicating that this situation was truly beyond reasonable control.

surf

Surf,
Do you understand the types of positions Vic places??

You need to stop listening to the Vic mantras and simply look at what he does...He sells short dated options,balls to the wall and is inacapable/unwilling of managing his gamma.

I am in no way being judgemental as I am sure he is a brilliant person.But once he puts that short gamma trade on the books,it is irrelavant how brilliant the reasons were.You can talk skew,kurtosis,mean reversion,dispersion or any other term that gives you a chubby,but the simple truth is Vic is a shitty derivatives trader who should not be running a short gamma book...Period

 

[jem]

surf - how come I have not gotten props from you about VN. I believe I pulled an RM for clarity of prediction about VN.

for instance this is one of our dozens of exchanges in which I constantly ripped your buddy.

If you wish to see writings of an irrational egotisical mind about to blow up, read that first VN book. just bring your vomit bag.

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marketsurfer


Registered: Apr 2002
Posts: 11026


06-16-07 12:59 PM

Quote from jem:

If you wish to see writings of an irrational egotisical mind about to blow up, read that first VN book. just bring your vomit bag.





Give me a break--(with apologies to John Stossel) So, the number one ranked fund manager for several years and one ranked in the top 5 for many years is an irrational mind? Someone who rose out of Bronx, from meager beginings to prominence in the financial markets is not worth reading? A polymath, follower of the scientific method, Harvard graduate, Chicago PhD and Berkley Professor, has nothing to teach anonymous message board posters? A fund manager with 400 plus million under management, who shares freely some of his and his collegues research ,via an educational website is deserving of this type of comment? A person who lost it all, 11 years ago, but now is back on top in the same field, isn't someone who we can all learn from? Not to mention the dozen or so 100 million-Billionaire money managers who have arisen out of his tutelage- Education of a Speculator was basically required reading for anyone on wallstreet when it came out. Almost everyone in the business had a copy on their shelf.

For those who may not know who we are talking about, here's a brief synopsis:
http://www.dailyspeculations.com/vi..._interview.html

surf

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jem


Registered: Sep 2001
Posts: 4508


06-16-07 03:24 PM

where in his book do you see him teaching anything but the fact that he is a brilliant mind, he listens to classical music in the trading room, and if you are not as smart and gifted as he is do not try to trade.

Regarding irrationality

fact- soros told him he was trading the wrong way

he claimed to be a superior researcher with superior methods

yet he related stories to us how he was playing brinksmanship with the guy on the other side of trade for pretty much everything he was worth.

He told us of his penchant for betting it all after a few losses. Because the big loss was not going to happen to him VN.
The VN who "neiderhofferd" harvard

do I even need to explain it further.

A guy claiming superior research and intellect describing trading that could at best be betting it all on Red.

yet somehow he felt protected because he was special.

That my friend was a truly irrational mind. And that is why soros took his money away from him.

Now if you wanted to know how a smart guy could be so irrational you could really have some fun with it - as I have.

I explained to you that he has the same inferiority complex as Tony Manero had in Saturday Nigh Fever.

Whereas Tony's talent allowed him to understand that the people in Manhattan were no better than his kind from Brooklyn.

VNs inferiority complex drove him to work his ass off to get a hedge fund and move to Greenwich.

the big difference is that he still was driven by that complex.

so instead of taking a large loss and slowly working his way back - he was compelled to bet it all. (truly irrational)

Interestingly you could say he was so irrational he sabotaged himself because in his own mind he knew he did not belong.

If you have any more softballs Surf I like them about chest high with the arc no higher than 12 feet.

 

[Pekelo]

Quote from taowave:

He is flawed as a trader,and his charm,genius and brilliance somehow blinds his loyal following.

I don't know about others, but if I had loyal followers and after I made an incredibly stupid mistake (OK, two) they would still keep uncritically prize me, well, I would just flog them to death, for being idiot asskissers.

But again, that is just me....

True friends tell you how it is, not how you want it to be...

 

[Rearden Metal]

Quote from taowave:



Surf,IMHO Vic was overleveraged much closer to 400% ....

We may have both meant about the same thing, as it can be understood two ways- I shouldn't have used percentage terms.

Since "overleveraged 100%" can mean positions that are double proper size, by "overleveraged 250%" I meant that his positions were at least 3.5 times a workable, appropriate size.
If you meant "overleveraged 400%" to mean the positions were 4 times too big, we're in about the same place on this one.

Boring post, I know- But I just realized how easily my intentions could have been misunderstood, hence the clarification.

 

[acronym]

This collection, is amazing-in sheer hubris.

Everyone banging on about VN, but-this thread is about "stuff" ,who the hell WOULD buy this stuff? Has the auction finished, or is it just unpopular?

Anyone look at the photos? Blech.

Rip off. All the artistic flair of a mussolini speech, starts fat and ostentatious, and stays that way.

I wonder, what fool would have procurred all this, for sale a decade later.........hmmmm.

 

[Rearden Metal]

Quote from acronym:

This collection, is amazing-in sheer hubris.

Everyone banging on about VN, but-this thread is about "stuff" ,who the hell WOULD buy this stuff? Has the auction finished, or is it just unpopular?

Anyone look at the photos? Blech.

Rip off. All the artistic flair of a mussolini speech, starts fat and ostentatious, and stays that way.

I wonder, what fool would have procurred all this, for sale a decade later.........hmmmm.

Where'd you find pictures of the artwork?
All I saw at Surf's link was the angel nymph on the cover.

 

[acronym]

Quote from Rearden Metal:

Where'd you find pictures of the artwork?
All I saw at Surf's link was the angel nymph on the cover.

Bingo.

Trophy and presentation silver?=worthless. Kinda like a signed bat from barry bonds, or similiar.

What trophies?What presentations? Only a die hard fan would go for it.


Excellence in what-the thai market kicked his ass, this guy is a real lesson to penny dreadfull traders everywhere.
Really, he is.
I just dont give a crap anymore, so i just say it like it is.

You want tawdry, unsubstantiated ebay auctions, you got it!

 

[acronym]

Sure. only a few days, but remarkably, no bids.

http://cgi.ebay.com/Victor-Niederho...2318631QQcmdZViewItem?IMSfp=TL071218168a27830

Heck, i could bid on it at that price. What exactly is it?
For such an exclusive, remarkable treasure trove, golly, it seems $150 is a steal.

Will no-one bid, on this priceless treasure trove, from liquidation to-u at bargain basement value?

Pardon my cynicism, but ebay does that to people.

Edit-oops, the paypal account required rules me out.