The girlie has to pay our dividends too LMAO!
Ha ha ha!
The shame is the angle- I think he's OK being broke, the problem is everyone in his life knew he had been doing really well for some time, and now he has to explain what happened. Once he's done explaining, I think the healing will come very fast. Who knows, maybe by the time he's trading again in 6 months or a year there will be great opportunities and he'll make it back fast. If he comes back with 10K he's going to need to double it 5 or 6 times to cover the losses but he's a man who can do that.
Yes Joey I have advised him not to watch particularly tomorrow when we all know VXX is going to be killed. There's even a chance it'll go back to 16 next week, not likely but possible. And in a year, figure it will be $4 or $5. That's when it's going to really hurt- when he will have to face that something he shorted dropped 60-70% and he still lost 200% of capital. It's amazing how obvious it looks now in hindsight, almost like you can reach through time and scream at him just to take the loss on the Friday before. He probably was only down 50% at that point rather than 200%. But he thought it would come back down Monday, and that's the way the game goes.
How much did you pay for those 15 strike? They seemed to hold up pretty well during a run from 24 to 90, so somebody thinks it's going under 15 by March. The bid/ask spread is far too wide for me, I hate that. Seems like it'd be impossible to get even 100 contracts.
Also, I know you can't verify it- I exchanged e-mail addresses with Schizo a long time ago and have been receiving his weekly updates via private message since he didn't always post them here. He's going to be OK in the end, it's going to be a long time before he has the money paid back and is trading again, and that might be for the best. I'm trying to get him to just ignore VXX price as it continues to be slammed lower.
You said a mouthful mister. Let's say VXX is 10-12 in 6 months (a reasonable guess I think). Schizo will have had a short position in something that dropped 30, 40% but he will have 200% loss of capital. Is that not one of the most amazing, and truly sad things you've ever heard of in your life? It sure is for me. I'm trying to get him not to even pay attention until he gets his account funded again. Why torture yourself watching it go back below 16? No purpose IMO and can only lead to more misery.
He was not short UVXY, but VXX. Imagine how much worse UVXY would have hurt him. Even so, being way over all in VXX short for a 75% move was enough to nuke him. He's a pretty mentally tough person so this is not going to break his spirit by any means.
I've been trying to get him not to even watch VXX price. That's the worst thing- they covered for him at 28. Now at this point, it will likely never hit 28 or 27 again and maybe not 26. In fact by the time he has everything liquidated, gets the broker paid off and gets back to trading VXX, if that takes 6 months VXX could be down to single digits. And then he's going to be saying "Man, a 6 months period where VXX went from 16 to 6 and I had 200+% loss shorting it."
And that's when he's going to need all of us to help him stay strong and not think about what could have been.
Things are moving forward OK. He had a good meeting with an attorney who is guiding him through the process. His inheritance is not very liquid so that complicated the process. It's looking like he may come out of this being able to pay the debt off and still have a bit left over to start trading. Very fortunate he had other assets at his disposal although he's disappointed his family has to see most of his inheritance go to this.
Good news is he's going to have 10, 20K to work with. It's a heck of a long way back up to 300K, and it cost him several hundred thousand dollars of inheritance in addition to losing all his capital, but it was also a very good lesson for him about how he'll trade going forward. I expect he'll still be somewhat of a gunslinger, but with some smarter setups.
The hardest part about it as you might expect is seeing that VXX will be back below 16 very soon and not being able to ride it down. He had the trade nailed just not the timing or position size and they're all vital.
I guess that would be possible- how would one go about doing that without the broker somehow finding out since he owes them money? Forgive the naivete, it's a serious question- none of us needs to get in trouble least of all him.
I will pass it along sir! As far as getting back in the game- I'm not sure how he could do that. He owes his broker quite a bit of money, his inheritance may not be enough to cover the balance. So I don't see how he can get back in when he owes people money, maybe a good attorney can help him with the logistics.
The sad thing is he had done quite well for years, was in a position to be independent and didn't need to take any chances. This game gets in your blood I guess and nobody saw that move coming last week.
The reason I posted about it is to help people avoid what happened to him. I don't know if you paid attention to his posts or not but he was red hot for a while, had really put himself in a position to have a nice life. Now, he not only lost all his profits, he lost his original investment *and* he is in talks with his broker about how to go about liquidating his inheritance property to cover the losses.
It's cruel because they took him out at the open Monday. You never expect that kind of VXX gap, in fact it had never happened. Now he not only has his future wrecked, he gets to watch VXX go back to all time low soon and can do nothing about it. Like you said, need deep pockets. If this keeps just one person from the same fate it's worth it.
Just need to find the best put play given the 25 cent target.