I have watched the video below
https://youtu.be/CkhcpcuZvV4
It made me thought was the nick leeson case as simple as that? Actually, i was wondering if their management let go since leeson was bringing in money.
In the video, you will see that leeson placed ego and how other people viewed him as more important than making actual returns.
And also, something struck me, the management actually felt like really greedy guys who know nothing about market returns, which is that you cannot predict returns, the market gives you whatever it wants.
Part of the video seems to hint that management was pressuring leeson to produce target returns and "achieve their former glory".
Leeson himself seems to be extremely eager to try to please them and then become one of them.
So actually it started out as him helping his new traders correct mistakes, but further on it became more fraudulent.
So actually it feels like its alot simpler to be a retail trader, no need to answer to anyone.
If you watched the other movie, the 1997 movie. What george said before leeson broke down, was dont fight the market. What i believe leeson's position was, was a short straddle and long futures. Against a collpasing market due to the kobe earthquake.
I think the issue was, he double down on direction, his deltas downward spun out of control, and that is the main issue.
Main reason why i use the 3 legged animal is partly because of this. You cant blindly double down, sometimes its a cut and flip, sometimes its a rotation, but the crux is, ease bleeding, but not at expense of increasing too much risk, hence anything not covering tail risk is not acceptable. VaR, but VaR simulated against expanding volatility, now thats even more scary. The issue isnt that VaR is not useful, VaR assumes some fixed volatility, its that if the estimated volatility is off, and rescue has huge chance of being calculated wrongly, and thats how accounts go belly up, no one really knows how far the market could go, thats why i rather play both sides of the coin, and be both a bull and bear. At least i did damage control amd could stop the bleeding before it becomes problematic.
The final key, is to study suppose i am at my limits exposure, and i can request additional troops for 1 final rescue, in the similar setting as the kobe earthquake and long yen futures, what strategies can i do to ease bleeding? Against a finite capital.
https://youtu.be/CkhcpcuZvV4
It made me thought was the nick leeson case as simple as that? Actually, i was wondering if their management let go since leeson was bringing in money.
In the video, you will see that leeson placed ego and how other people viewed him as more important than making actual returns.
And also, something struck me, the management actually felt like really greedy guys who know nothing about market returns, which is that you cannot predict returns, the market gives you whatever it wants.
Part of the video seems to hint that management was pressuring leeson to produce target returns and "achieve their former glory".
Leeson himself seems to be extremely eager to try to please them and then become one of them.
So actually it started out as him helping his new traders correct mistakes, but further on it became more fraudulent.
So actually it feels like its alot simpler to be a retail trader, no need to answer to anyone.
If you watched the other movie, the 1997 movie. What george said before leeson broke down, was dont fight the market. What i believe leeson's position was, was a short straddle and long futures. Against a collpasing market due to the kobe earthquake.
I think the issue was, he double down on direction, his deltas downward spun out of control, and that is the main issue.
Main reason why i use the 3 legged animal is partly because of this. You cant blindly double down, sometimes its a cut and flip, sometimes its a rotation, but the crux is, ease bleeding, but not at expense of increasing too much risk, hence anything not covering tail risk is not acceptable. VaR, but VaR simulated against expanding volatility, now thats even more scary. The issue isnt that VaR is not useful, VaR assumes some fixed volatility, its that if the estimated volatility is off, and rescue has huge chance of being calculated wrongly, and thats how accounts go belly up, no one really knows how far the market could go, thats why i rather play both sides of the coin, and be both a bull and bear. At least i did damage control amd could stop the bleeding before it becomes problematic.
The final key, is to study suppose i am at my limits exposure, and i can request additional troops for 1 final rescue, in the similar setting as the kobe earthquake and long yen futures, what strategies can i do to ease bleeding? Against a finite capital.
