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Some of you might have heard some rumblings from over in WSB-land. In fact, at 5 this morning, I sent the following email to Tom Sosnoff and Tony Batista, my colleagues at tastytrade:
I’m not sure if either of you ever don your hip waders and saunter into the madhouse which is /WSB, which the place has turned 100% into a mayhem-filled attic of people shrieking about how you can trick RobinHood into giving you obscene amounts of buying power (like $1 million on a $4,000 deposit). Seems their system is pretty broken, and figured you would want to know (although I suspect you probably know all too well by now) since their faulty code has really exposed them, at least to this group of degenerates on WSB.
I must confess, when the market spends the entire month of October racing higher to levels never before seen in human history, and at valuations that are absolutely comic, my gonads shrink to pea-sized. I thus take a pass on patterns that, while tantalizing, still scare me too much to pursue. What a shame. Here are a couple that slipped by grasp:
We live in a very complex word, and it grows more complex by the day. But let’s set aside all the uncertainties, possibilities, relationships, and exogenous outliers. Let’s strip it away and focus on the basics.
It’s quite evident that being simple-minded in 2009 was the way to go. The President said to go out and buy stocks. The Federal Reserve made it absolutely clear they were going to pour everything they had into “saving” the economy. Any member of John Q. Public who naively took them out their word has made out fabulously well to this day. We sit at lifetime highs in equity markets, in spite of a $23 trillion debt which is going to grow $1 trillion per year (at least) as far as the eye can see.
I have mentioned the sub-reddit Wall Street Bets (WSB) quite a few times here on Slope. For those of you unacquainted with it, it’s basically packed with degenerate gamblers, largely in their 20s, who get fixated on the stories from the sprinkling of extremely profitable options traders in there and, for their own accounts, lose most of their money. I went over there just now for an example, and it took me about three seconds to find one:
I wanted to share a few thoughts about my “tilt” toward market-neutral options trading. This has been a long time coming, and I might as well explain myself.
It’s not for lack of other people trying. Dutch and The Director have been trying to convince me to experiment with various options strategies since Lyndon Johnson was in the White House, and many Slopers have been pinging me to try to learn something other than shorting anything with a ticker symbol that fell into my line of sight. I ignored them all. Until now.