My account wiped out. Any recourse?

I think that was from PD givin' the OP some tough love.

Awww...market lessons. We all gotta learn them.

 

Do you really think market makers are holding on to all that gamma you sold? Most OMMs naturally have a short gamma bias since they are the first ones to see the flow and can quickly turn the position around. Some dude out there that bought the vol you've sold (me, for example) right now is sipping scotch and giggling.

 

WIND-UP THREAD. --could be pronounced two ways.

 

I worked at a brokerage for 7 years. The majority of brokerages will not chase the debt aggressively. I'd advice not paying the full debt but maybe offer them 10-20 cents on the dollar.

Cost of doing business.

 

What if I was the dumb trader who bought vol (following Taleb) from you in the beginning? Are you still sipping scotch?

Wait, I forgot, you, the MM, sold my vol to @bthale51 for a profit then sipping scotch and giggling.

 

Well, someone bought vol and someone sold vol. An options market maker is in the middle, transferring risk for a fee. This said, some of them did pretty poorly in this disaster - for example, a few Chicago firms (for instance, C*** T*** and B********) blew up and had their positions liquidated.

 

Kidding aside, I thought MM always make money?

 

I take my trading seriously. Never have I gone off-grid while my positions are open. Can't imagine doing that especially with naked positions.

 

Isn't it too late to rationalize? Why don't you just confess that you've messed up and you're sorry for your overoptimistic blunders?

 

The guys who do make money most of the time are the higher frequency guys that buy order flow from the retail and usually have very little positions at the end of each day. That's a heavy duty technology business and it's very hard to get involved there.

"Real" market makers do take meaningful risk and sometimes get run over. In options, it happens because MMs end up with a large position and did not anticipate some event/ I would imagine a lot of index market makers were conditioned to puke their gamma right after they bought it and went into these moves short gamma or (worse and it's a common MM position) long gamma but short skew. That would have hurt a lot.