My Friend Was so Much Older Then

What a humbling business this is. I remember this market maker friend of mine who had a roaring start in the trading pits here at the CBOE. He made sure to tell you how his trading style was so successful it was just like printing money. He would conveniently leave the back pages of his daily P & L on a coffee table for everyone to see. Including the receptionist he was smitten with.

Well all good things usually come to an end. Sometimes luck is better than being good but that sweet fortune usually only lasts for a little while.  You see my swaggering friend who was a big time premium seller got caught in the jaws of short volatility. Years later he told me how he acted so carelessly back then by selling nearly every option in sight only to lose almost everything he had. Then he borrowed a line from a Dylan song and said….”Ah, But I was so much older then, I’m younger than that now”. 

You see my friend thought he had the wisdom of a veteran trader with nothing left to learn. But now he was eager to leave his old self behind and move on with a fresh attitude of accepting that there is still so much to learn trading options. With acquired knowledge and good judgment my friend lasted 16 more years in the trading pits here at the CBOE.  

So many option traders like my friend want to grow up so fast. But the truth is, new found youth and learning from your mistakes is where it’s at.