2/7/2018 XIV Trader Loses $4 Million And 3 Years Of Work Overnight: Here Is His Story | Zero Hedge

XIV Trader Loses $4 Million And 3 Years Of Work Overnight: Here Is His Story

by Tyler Durden
Tue, 02/06/2018 - 15:47

The devastating 90% overnight collapse in the now "terminated" XIV Exchange Traded Note (ETN) has had many casualties - from one hedge fund down as much as
65%, to Morgan Stanley's (formerly) $39 million position, to Reddit user /u/Lilkanna who posted "Ive lost 4million USD, 3 years worth of work, and other people's
money" in the "TradeXIV" subreddit. 

"1.5 mill was capital I raised from investors who believed in me," Lilkanna wrote. "I had a leveraged position I used DTBP to buy and it was down like 1% and I
thought I could hold it knowing that I would get a reg-t call deadline in 2 days."

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As confirmation of his woes, Lilkanna posted a screenshot of his depleted account:

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2/7/2018 XIV Trader Loses $4 Million And 3 Years Of Work Overnight: Here Is His Story | Zero Hedge

Close up:

“The amount of money I was making was ludicrous, could take out my folks and even extended family to nice dinners and stuff,” he wrote. “Was planning to get a nice
apartment and car or take my parents on a holiday, but now that’s all gone.”
"Sad thing is I was long VIX until a couple of days ago. I was sure there was gonna be a correction but with each passing day my conviction wavered. Stupid. Really
fu**ing stupid. I feel like such a fool."

While some Redditors were supportive - emoting empathy, “Hey man, I know others have said it but I’m here for you man,” one user wrote. “It may seem like the end of
the world but tomorrow is a new day.”

Another Redditor said “Jesus dude, if you were able to turn 36k into 2.5 million (even with raised capital), you can make back all the lost money and then some,” he
said. “You just have to learn from the lessons and give it time, you will make it back in no time. It sounds cliche as f**k but you know its true.”

User /u/asianhere commiserated with Lilkanna, writing "I feel you as I've lost 1/2 of my net worth today T_T prob 5 years on my life"
For what it's worth, Lilkanna is able to take responsibility for his epic fail:

I guess you never expect it until it hits you. You always hear stories about how people get cancer and how people get randomly killed in the street or about
how they lose all their money, but sometimes you find it hard to believe that it will happen to you.
I started with 50k and traded all the way to 4 mill over 2.5 years, started using more and more margin, started taking it less less seriously, what could
go wrong? Arrogance. Stupidity.

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Ah well. Thanks for the kind words though. They are more comforting than you realise.

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Credit Suisse, XIV's issuer, announced this morning that February 20 will be the last day of trading before termination. 

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Comments

Sort by Thread Date Order Oldest Items per page 50

lychee_candle • Feb 6, 2018 3:48 PM

31 Permalink
0 risk control, mate!

75 J S Bach  lychee_candle • Feb 6, 2018 3:52 PM

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3
Greed kills.  This is why the crypto frenzy will also ruin a lot of lives.  No self control.

44 Bodhi  J S Bach • Feb 6, 2018 3:57 PM

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3
Where are all the stories of those dopes refinancing their homes to buy BitCoin?   

30 Ajas  Bodhi • Feb 6, 2018 4:00 PM

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8
When I first came here, this was all swamp. Everyone said I was daft to build a castle on a swamp, but I built in all the same, just to show them.

It sank into the swamp. So I built a second one. And that one sank into the swamp.

So I built a third. That burned down, fell over, and then sank into the swamp. But the fourth one stayed up. And that’s what you’re going to
get, Son, the strongest castle in all of England.

18 BullyBearish  Ajas • Feb 6, 2018 4:03 PM

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1
there will be those who give back 10 years worth of LONG gains buying the dip ALL THE WAY BACK DOWN...

7 RAT005  BullyBearish • Feb 6, 2018 4:07 PM

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1
Most of the crypto investments are cash rather than margin so I hope it won't be so bad.  Of course there were people that margined
themselves outside the crypto market and still have that margin to deal with when crypto crashes.

8 IH8OBAMA  RAT005 • Feb 6, 2018 4:09 PM

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0
Not the first time this has happened and certainly not the last.

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14 InjectTheVenom  IH8OBAMA • Feb 6, 2018 4:21 PM

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1
Welcome to the real world, son !!
Now, how long til this guy opens a GoFundMe  page  ?

5 lloll  InjectTheVenom • Feb 6, 2018 4:53 PM

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2
When someone loses, someone else pockets it.

That's how it ALWAYS IS when any crash occurs.

11 rcintc  lloll • Feb 6, 2018 5:16 PM

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0
Bulls Make Money, Bears Make Money.....Pigs Get Slaughtered

22 overbet  rcintc • Feb 6, 2018 5:22 PM

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3
Fuck this whiny loser. Go jump off a bridge pussy. Another moron buying hand over fist in a bull market that thinks hes a genius. I know
one guy who made a few million a year for 5 years then the market changed and the only change he made was to increase his size and
dub dub double down dumbass. Blew out all his earnings and then some. Knew another guy who always added to winners. That was his
"secret sauce". He turned 70k into 4 million in less than 2 years. He thought he was a genius too til he lost it all in a day. Seen another
guy that had a legit edge and decided to automate it. You know he didnt close a loop in his code and sent orders like a gattling gun.
Done before he could pull the patch cable. I seen a lot of guys come and go. You know who makes it? Guys that change. Guys that back
off when something that worked stops working. They tweak, reevaluate, try another way or start fresh. The guys that last are obsessed.
Cardinal rule: Always leave yourself outs.

 
Dont you love the screen shot begging for sympathy. Oh poor more feel bad for me tell me how unlucky I am. Fuck you. Youre a fool

14 Dsyno  overbet • Feb 6, 2018 5:23 PM

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0
"Now son, you have the strongest castle in all of England."
Ya, but the idiot still lives in the fucking swamp.

11 dchang0  Dsyno • Feb 6, 2018 5:41 PM

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0
Yeah, and the guys who built their castles on bedrock have already built ten castles in the time the swamp-king rebuilt just one castle
four times.

Ya hear that, New Orleans and the wildfire-prone areas of California? Stop using insurance or taxpayer money to rebuild over and over
in the same damn disaster-prone areas!

0 JRobby  Dsyno • Feb 6, 2018 8:42 PM

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0
Florida?
It's just booming!!!!!

0 MrSteve  JRobby • Feb 6, 2018 10:08 PM

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0
Florida?? Florida!! Can we get stucco? Groucho: Boy, can you get stucko...

0 Jackprong  overbet • Feb 6, 2018 9:52 PM

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0
I could not agree more with this post.  I have been in the stock market for over 38 years.  I was mentored by a former commodity broker
who bought his first common shares in 1928 and still owned many issues when he died in 2002.  Unless one owns a real stock, a real
bond, a real mutual fund that owns real stocks and/or bonds, playing these dicey indices can only rip one's face off.  It's hard enough
knowing underlying businesses and demand in stocks and/or bonds.  Why make it even more dicey by putting money into something that
is not real, that has no value?  XIV, VIX, whatever is not real, has no value with whimsical volatility.

1 Wage_Slave  lloll • Feb 6, 2018 7:29 PM

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0
Just like poker. But in this game the cards are marked.

0 Retired Guy  lloll • Feb 6, 2018 7:56 PM

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0
Bull. ABC Corp drops 50 points a share. Are any stockholders richer? No. A few shorts will be happy but mostly money has been lost.

1 Endgame Napoleon  IH8OBAMA • Feb 6, 2018 6:41 PM

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It is sad story of regret. This business is like a tight-rope wall. One miss and you could lose it all. Scary. 

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4 DillyDilly  RAT005 • Feb 6, 2018 4:14 PM

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0
7 years of [your kids college fund] down the drain!

3 aurum4040  RAT005 • Feb 6, 2018 4:24 PM

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3
Exactly. Cash in cryptos is what you do. Not that i havent traded 5 times margin w Kraken thousands of times. But...its not smart. Ive gotten
burnt. Not badly. But burnt....Most of my trades at this point are cash with more cash on sidelines for days like last night/yesterday...High
margin trades are just not smart. Inevitably it will work against you. Just a matter of time. 

4 Antifaschistische  RAT005 • Feb 6, 2018 6:07 PM

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0
It's not a cash investment when you put it all on your CC, and take out an Equity loan on your house, and you don't even tell your wife....the
stories will be pretty epic.   The most epic stories...we'll never hear.

2 Endgame Napoleon  Antifaschistische • Feb 6, 2018 6:44 PM

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0
But that guy did not do something irresponsible like that. He had extra money and made a lot from investing it, losing it over just one wrong
move, or that is what it sounds like.

7 eclectic syncretist  BullyBearish • Feb 6, 2018 4:07 PM

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0
If there is a next time, you can bet that he will do it differently. Congratulations to anyone out there lucky and smart enough to be able to
learn from other peoples mistakes and not their own only. 

4 cheech_wizard  Ajas • Feb 6, 2018 4:04 PM

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0
Because nothing says success by building on previous failures, or something like that.

7 GUS100CORRINA  cheech_wizard • Feb 6, 2018 4:07 PM

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XIV Trader Loses $4 Million And 3 Years Of Work Overnight: Here Is His Story

My response: What could possibly go wrong? See chart below.

https://www.finviz.com/quote.ashx?t=SVXY&ty=c&ta=0&p=w

2 Hari_Seldon  GUS100CORRINA • Feb 6, 2018 4:48 PM

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0
Laughed my fucking ass off at that one.

0 hedgeless_horseman  GUS100CORRINA • Feb 6, 2018 9:38 PM

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0
 

What could possibly go wrong? See chart below.

Exactly.  
"But I had it made. The farmer fed me every day for a year, up until the week of Thanksgiving,"  said the turkey.

Hat tip: N.N. Taleb 

161 whatswhat1@yahoo.com  Ajas • Feb 6, 2018 4:06 PM

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1
JUMP

1 Dr.Strangelove  whatswhat1@yahoo.com • Feb 6, 2018 7:45 PM

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0
How High?

3 booboo  Ajas • Feb 6, 2018 5:54 PM

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0
But I don’t want a castle, I just want the sing 

music starts

STOP IT STOP WE’ll have none of that!!

0 Knight who says Ni  Ajas • Feb 6, 2018 6:43 PM

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0
Awesome

JRobby  Ajas • Feb 6, 2018 8:37 PM

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2 Permalink
0
https://www.youtube.com/watch?v=-jO1EOhGkY0

HERBERT: You got my note!

LAUNCELOT: Uh, well, I got A note.

HERBERT: You've come to rescue me!

LAUNCELOT: Uh, well, no, you see--

4 RAT005  Bodhi • Feb 6, 2018 4:01 PM

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0
My story was opposite.....loose first, then spend months earning it back.  After the second time I quit.  I feel for him, but when it starts moving
against you, it's so hard to function.  I wonder how much is driven by people with access to see the bid ques and know where the trigger points
or cliff point is and know just enough when to bail confidently, even at a loss.

6 Joe Trader  RAT005 • Feb 6, 2018 4:08 PM

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0
Stop loss rules were changed 1-2 years ago. Stop orders aren't supposed to "sit" on the market, so you're not supposed to be able to see them,
they only get sent once triggered. Correct me if I'm wrong.
I got stopped out late last week, fortunately price came back up to my stop limit range after gapping below it - then tanked. Seeing price gap
below your stop really sucks, my take away was use wider stops.

Do what the pros preach: cut your losses: QUICKLY.

8 Occams_Razor_Trader  Joe Trader • Feb 6, 2018 4:54 PM

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0
Id bet my last dollar that the forex servers "stop hunt"- it happens waaay to often to be a coincidence. Interactive Brokers maintains hidden
orders on their internal servers seems more fair.

1 fellatio is no…  Occams_Razor_Trader • Feb 6, 2018 5:00 PM

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0
110% spot on, yes it's a thing

0 overbet  Occams_Razor_Trader • Feb 6, 2018 6:08 PM

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0
More fair for their timber hill

0 Occams_Razor_Trader  Joe Trader • Feb 6, 2018 4:54 PM

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0
Id bet my last dollar that the forex servers "stop hunt"- it happens waaay to often to be a coincidence. Interactive Brokers maintains hidden
orders on their internal servers seems more fair.

9 fellatio is no…  Joe Trader • Feb 6, 2018 4:59 PM

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0
NEVER use a stop or stoploss order, the market makers look at those and say "FREE MONEY" then they take the security to your stop price,
execute it and move the security back up.  How many times have you been stopped out only to see you were the low for the day (or just above
it) every time.  I guarantee you anytime you place an order like that you will get stopped out

2 Joe Trader  fellatio is no… • Feb 6, 2018 6:32 PM

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0
It depends. Whether a stop order is used or not, if max pain, your exit point comes up...will you actually sell each time? are you fast and
attentive enough to do so? I agree that problem exists, but we still have to somehow stick to our systems. There will still be slippage if you
sell manually. Price can also bounce back up after you sell manually.

1 Conscious Reviver  Joe Trader • Feb 6, 2018 9:00 PM

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0
Create your own algo.

5 davinci7_gis  Bodhi • Feb 6, 2018 4:02 PM

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0
One's gotta know when to pull out...or at least put some aside into GOLD!

2 SilverDOG  davinci7_gis • Feb 6, 2018 4:46 PM

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0
That guy demonstrated the 100 Monkey Rule precisely.

ALL but him, the last Monkey screamed come on out, the ice is safe Mon. 

...and its gone.

Whenever one gets that feeling, the feeling the masses are correct, that your own individual position and process is not correct due to flock
wheeling away
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wheeling away...
LOCK & LOAD.

5 Oldguy05  davinci7_gis • Feb 6, 2018 5:04 PM

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1
I have a son by an insane woman I was seeing at the time. He turned out awesome. She's a little calmer after 18 years of unwavering child
support. $60K sunk into that. Obviously, I don't know when to pull out.

I could have made $4Mill and lost it dammit!

But I have a great son to show for my investment. It was a good deal as I hear usually kids are far more expensive than that.

0 Lost in translation  davinci7_gis • Feb 6, 2018 6:18 PM

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0
Indeed.
When in doubt, you must pull out.

0 OccamsCrazor  Lost in translation • Feb 6, 2018 8:13 PM

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0
so says the guy who got the high school girl pregnant. 

0 Lost in translation  OccamsCrazor • Feb 6, 2018 8:50 PM

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0
You’re confusing me with someone else.

2 Endgame Napoleon  davinci7_gis • Feb 6, 2018 6:54 PM

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0
If I had money, I do not think I would have the cahoonas — literally or figuratively — to do this, nor the math skills for that matter. I would have
to pay the broker fee or just put it in something safe, like gold, that would not have a high return. I would buy one stock in a company I actually
just liked, just to watch it. This is kind of interesting, but it is pretty complex for ordinary people to place bets in a sea of human experts and
bots on steroids. This guy performed well, considering that he started without a background in trading. 

0 Eyes Opened  Bodhi • Feb 6, 2018 5:07 PM

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0
Oh well.... some days you're the dog...

And some days you're the pole...  😔

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