Just read this article in The New York Times: http://www.nytimes.com/2016/03/20/b...quity-executive-accused-fake-investments.html He lost $95 millions of OPM. What caught my eye was this sentence: Any of you know what were his "aggressive" options?
My guess would be OTM Long Calls and/or Puts or OTM Debit Spreads. Credit Spreads and other "income generating" option strategies aren't aggressive enough.
Aggressive means trading too many options it's as simple as that. Whenever people get 'aggressive' in this game it normally always ends in tears. People, especially on Wall Street, seem to get impressed with aggressiveness but in reality it just means you're making lots of rope to hang yourself at some time in the future. Aggressive also tends to make the news as people go 'oh' and 'ah'. Non-aggressive doesn't make the news as there's no flashy story. But the non-aggressive traders are normally always the best.
Actually there are times to be very aggressive (as u defined it) and times when you need to be very cautious. Both with risk control.
It could have been as simple as being short a ton of OTM puts last August or being short a ton of OTM calls last October...I believe that the biggest blow ups occur via short deep OTM options since the "jump's" in price tend to catch many completely flat footed and unwilling to take a loss that they didn't believe possible.