Back when I was a lad, I subscribed to Investors Business Daily (umm, that didn’t last). There was a full page ad that appeared just about every day for something called The Better Software People, and it basically showed how, using their software, you could have turned $10,000 into $43 million, or something like that.
I don’t think I ever subscribed to their product, but the ad had the same effect on me as I suspect it had on a lot of other people, which was to put stars in our eyes about how easy it would be to just print money by participating in the equity and index options market (and this was back in 1985, so you can imagine how horrible the options markets were, to say nothing of the bid/ask spreads, which were probably wider than Kim Kardashian’s backside).
In the modern age, it is my opinion that the good folks over at /WSB have collectively had the same effective on the newest generation of “traders”, particularly with the glorious mayhem of February 19-March 23. Simply stated, the young lads over there got all excited about the monstrous profits the gunslinger put-buyers were making, and they wanted some of that sweet, sweet profit for themselves.
Of course, I imagine the peak excitement was, oh, about March 23rd or so, so those seeking profits from directional bearish players paid peak volatility. That, coupled with theta burn and Powell-powered prices, has destroyed put buyers. Like, say, this guy:
Yep. He took a $800,000 account and magically made it into a $100,000 account. Pretty spiffy, eh?
Then there’s this chap, whose nominal losses weren’t as high, but in percentage terms, he took a similar hit.
There’s no doubt I’ve handed back some of my obscene profits from Q1, but it’s been a flesh wound compared to these guys.
