This seems to be only an example of poor risk control by a supposedly experienced trader. NatGas spread apparently is known as the widowmaker for this reason, did he not know that with 30 years of experience ?
How can any 1 event, which does not look too bad in the underlying, cause bankruptcy? I am cynical here, I dont have any sympathy for him. He took his investors for a ride with possibly a system that was always going to do this one day ...
Having diversification is obviously good, but i dont think trading with large capital is undesirable .. Only thing is whether we can mentally handle it and take correct risks.