Losing $150 Million of Other People's Money with Naked Options Trades (WHOOPS!)
If you didn't hear about OptionSellers.com mega "blowup" back in November, buckle up. This is quite the tale. Unfortunately not a tale of the "tall" sort, this really happened, and investors really lost $150 million because of this stupid move.
James Cordier (OptionSellers.com) lost over $150 million of investors' money by using naked options trades to try to bank on volatility in the Natural Gas market. Cordier was successful making trades like this for many years, but all it takes is one bad "oopsie" and abra cadabra, his clientele, and yes, that $150 million, all gone. Cordier now also has an infamous reputation in the financial markets. Yikes...
But there is some good that came out of this. I certainly appreciated reading the comments on this youtube video of Cordier's apology. What else can you do but try to find some humor in this? Of course I sympathize with anyone who suffered a misfortune as a result of this event, but when you play with fire sometimes you get burned. Please do yourself a favor and watch at least the first 2 minutes of this video and read the Youtube comments.. you won't regret it. I laughed myself almost out of my chair during my break at work today, it's that good ;)
Here's his painful (yet entertaining) apology video. James will likely now be sued into to oblivion. Hedge your trades...
Here's an article about how OptionSellers.com blew up: https://www.bloomberg.com/news/articles/2018-11-21/founder-of-stricken-hedge-fund-promoted-selling-of-naked-options
Would love to hear what everyone else thinks about this event, Cordier's naked options trades, the Natural Gas/energy trades, or those funny comments and the apology video. Fire away! :D