General Trading Chat

[TraderRavi]

If anyone things trading or options is easy and everyone can make money. See this

This guy who has 30+ years of experience has lost all money in recent natural gas volatile movement !
30+ years of experience ! I think he managed energy vol ,,, Every asset class behaves like this some day or the other

very sad , but true . we all have seen due to black swan events many big traders, trading companies went bankrupt.

 

[travi]

Don;t know his fund size. But he said that he lost it all in one day Yesterday.
Must be margin trading!

Not exactly margin trading alone but this is the downside of Hedge Fund companies.

In India, Hedge Funds are allowed but the Tax is so high, flat corporate rate type that returns become meagre whereas MF houses enjoy a special structure.

If you see the rules laid out for MFs, there are a lot of restrictions. They can't speculate a lot, can't sell options, use derivates only as hedge leg.
Can trade any derivative that isn't in portfolio etc
So our domestic retailers have to be have with whatever returns come which are similar among all same MFs.

In US, the risk level is way higher, if you read books and stories of Hedge Fund wizards, they talk of consistent 30%-50% and other huge CAGR returns for periods like 10yrs etc.

Basically, Hedge funds can dump their entire long portfolio and go short on everything, This is where his boat capsized.
For a retail trader, it sounds too common, and it is. Difference was scale of funds.

Top hedge Funds, that are hard to get into or have special requirements to become a client will laugh at returns given by our domestic buy and Hold MFs.

 

[timepass]

Not exactly margin trading alone but this is the downside of Hedge Fund companies.

In India, Hedge Funds are allowed but the Tax is so high, flat corporate rate type that returns become meagre whereas MF houses enjoy a special structure.

If you see the rules laid out for MFs, there are a lot of restrictions. They can't speculate a lot, can't sell options, use derivates only as hedge leg.
Can trade any derivative that isn't in portfolio etc
So our domestic retailers have to be have with whatever returns come which are similar among all same MFs.

In US, the risk level is way higher, if you read books and stories of Hedge Fund wizards, they talk of consistent 30%-50% and other huge CAGR returns for periods like 10yrs etc.

Basically, Hedge funds can dump their entire long portfolio and go short on everything, This is where his boat capsized.
For a retail trader, it sounds too common, and it is. Difference was scale of funds.

Top hedge Funds, that are hard to get into or have special requirements to become a client will laugh at returns given by our domestic buy and Hold MFs.

You mean that in India, MFs need some permission for selling or have some special norms ?? I was aware of the restrictions about derivatives.

 

[Smart_trade]

Sad to see a trader losing his entire capital in one day.Excessive leverage ,overconfidence on any single trade,no risk control are some of the reasons....it is very difficult to come back from the losses ....tough time for the guy....

These accidents happen in our markets also...

Smart_trade

 

[timepass]

Sad to see a trader losing his entire capital in one day.Excessive leverage ,overconfidence on any single trade,no risk control are some of the reasons....it is very difficult to come back from the losses ....tough time for the guy....

These accidents happen in our markets also...

Smart_trade

Any similar stories from our markets ?? (not from Traderji

 

[Newbie Day-Trader]

If anyone things trading or options is easy and everyone can make money. See this

This guy who has 30+ years of experience has lost all money in recent natural gas volatile movement !
30+ years of experience ! I think he managed energy vol ,,, Every asset class behaves like this some day or the other

On another forum, they are saying that he was selling naked options (I presume on portfolio-margin), so this was inevitable. I'm not sure if risk-defined option-strategies would be so devastating.

 

[TradeJoker]

very sad , but true . we all have seen due to black swan events many big traders, trading companies went bankrupt.

Violent move ever on natural gas

 

[Smart_trade]

Any similar stories from our markets ?? (not from Traderji

Yes,one such happened recently ...but without discussing further,the best of the traders can go belly up if they don’t know when to hold and when to fold and they show slightest disregard for risk control.

Smart_trade

 

[superman]

Don;t know his fund size. But he said that he lost it all in one day Yesterday.

Must be margin trading!

I was wrong guys !

Update : He not only lost all his funds , he has negative balance and his clients must pay them also as per twitter ! So its negative balance ledger

 

[superman]

From twitter ; Mail sent to all of his investors