Millionaire Traderseverything netted out, I was buying options and hedging it. So I
had basically a long volatility position, which will be profitable if the
underlying moves significantly. So I was making money two ways,
first scalping and collecting on the bid offer spread, which was
paying some bills, and then building that into a long-term, long-
volatility position as the market was going crazy. Option volatilities
were getting more and more pumped as the gyrations in price
increased, and then I thought, I’m going to take this strategy and
run with it until I become billionaire. Naturally, about a month
or two later, I had lost all of that money. Volatility contracted
[laughter] and, of course, then everyone really wants to hit you on
the options at that time.
Q: Once you started making bids, there is no way to offset it,
right, because nobody wants the other end of it?
A: Nobody wants the other end of it when volatility is contracting.
So I got stuffed and probably lost all that I made plus about another
40 or 50 thousand. My equity swings were going wild.
Q: Who’s money was it?
A: It was the trading firm’s.
Q: How much of a line did they give?
A: I don’t remember exactly, but we pretty much had access to
funds. I mean millions, if you wanted it. But they were watching
you and every few days you’d be meeting with a risk manager.
Q: Were they screaming at you when you started going from
plus 40K to zero to minus 10K, minus 20K?
A: They weren’t really screaming at me. They were very happy
with the first month, obviously. They didn’t really warn me about