Employing newbies and taking the opposite side

Discussion in 'Strategy Building' started by Pekelo, Sep 17, 2005.

  1. Pekelo

    Pekelo

    Since when newbies start with a large runup??? And all of them at the same time?? Remember, this is a numbers game....
     
    #11     Mar 3, 2006
  2. I believe i read about this in George Kleinman's book "Commodity Futures and Options" (or some such).

    At any rate, regardless of where I read this, this is what (allegedly) happened:

    Some outfit hires newbie traders. gives them a $50,000 account. Lets them trade it at will

    The unspoken catch was that the money wasn't real. But of course the newbies didn't know that. The newbies where given profit and loss statements and everything else necessary to make them think it was real money. when they blew up an account, they were consoled and given another (phony) $50k stake.

    Of course the people who set all this up traded the other side of the newbies' trades.

    then one of the newbies put on a good trade and had some sort of medical crisis that incapacitated him for a quite some time. when the crisis was over, his postiion had shot up into great profitability.

    when the newbie got out of the hospital, he went to his boss and said "hey, how do you like that? I really put on good trade that time."

    the newbie was immediately fired, much to his puZzlement and chagrin.
     
    #12     Mar 3, 2006