{"id":2117620,"date":"2023-12-06T15:05:03","date_gmt":"2023-12-06T20:05:03","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/you-have-to-work-pretty-hard-to-lose-7-billion-in-a-week\/"},"modified":"2023-12-06T15:13:04","modified_gmt":"2023-12-06T20:13:04","slug":"you-have-to-work-pretty-hard-to-lose-7-billion-in-a-week","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/you-have-to-work-pretty-hard-to-lose-7-billion-in-a-week\/","title":{"rendered":"Losing $7 billion in a week requires significant effort"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">18<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fyou-have-to-work-pretty-hard-to-lose-7-billion-in-a-week%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2117620&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><h2>The Big Dog And The Fox<\/h2>\n<p>You have to \u2064<a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/tim-allen-knocks-we-culture-i-kind-of-liked-that-trump-pissed-people-off\/\" title=\"Tim Allen Knocks \u2018We Culture\u2019: \u2018I Kind Of Liked\u2019 That Trump \u2018Pissed People Off\u2019\">work pretty hard<\/a> to lose almost $7 billion \u2064in a week.<\/p>\n<p>Brian Hunter \u200dmanaged to do just that. Although\u200b he was coldly \u200bindifferent to the devastation his activities had\u2064 wrought, it was an agonizing experience for\u200d Amaranth\u2019s remaining investors, such as county pension funds representing teachers and public servants and others far removed in both geography and\u200d understanding of what was happening to their\u200d quickly evaporating\u2063 money.\u200c But, once again, as seems to be the \u2063mantra of the trading and\u2063 brokering \u2064business, their \u2062pain was our gain. The day after Hunter \u2062flew back from a golf outing,\u200c for example, the hosting broker received a call\u2063 calmly instructing him to sell tens\u2062 of thousands of one-year-out strips \u200dof \u2064call options. And these phone calls and instant messages from Hunter\u2063 and his\u200b assistants were going\u200c out\u200c all over the broker community. One broker was paid a million\u200d dollars \u200bin\u2063 fees for\u2064 one day\u2019s work \u2026 \u200bsomehow, even though the fund lost billions, they managed \u2062to scrape together the money to pay the commissions.<\/p>\n<p>As \u200clucrative as it was to\u200d be a \u2063broker \u2063in the Big Dog\u2019s pound, being one of the \u2063traders on the other side of Hunter\u2019s epic \u200dcollapse was a \u200dfar better deal \u2026 if you had the deep \u200bpockets and\u200b diamond-hard testicles to stay the course\u200d in the\u2062 face of his attempts to\u200b artificially squeeze you out of your fundamentally correct position in natural gas spreads \u200band\u2063 other derivatives \u2064by relentlessly buying and pushing the market up in your face\u200b until you were compelled by <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/russian-billionaires-lost-39-billion-in-a-day-on-stock-market-rout\/\" title=\"Russian Billionaires Lost  Billion in a Day on Stock Market Rout\">margin calls<\/a> to turn\u2062 the paper \u2062loss into a real one. This happened to one well-respected fund manager who got the trade right \u2064but entered just a little \u2062too big and a tad\u200d too early to withstand the paper losses he was incurring due to Hunter\u2019s Banzai charge of nonstop\u200d buying, especially \u2064of the March\/April spread, known\u2063 in energy trading circles as\u200c \u201cthe widow-maker\u201d for\u2063 its propensity to gyrate wildly with the slightest weather events. Eventually the fund manager\u2019s investors\u2063 couldn\u2019t take the\u2064 heat \u200band bailed\u200d on him, \u2063forcing him to\u2062 buy back his shorts and \u2062lock in his losses in a \u200dliquidation to \u2063meet a wave of \u2064redemptions.<\/p>\n<p>Down in Houston, John Arnold was also taking heavy paper losses\u2062 as Hunter \u2064dug his own \u2064grave deeper and\u200b deeper by buying gas that no\u200d one with any fundamental understanding \u2063of the supply\/demand \u200cdynamic in play would want anywhere close to these inflated \u2063prices\u2062 once he \u200bstopped\u200d his artificial short squeeze. But Arnold had\u200b made \u2064his \u200cinvestors a mint already, and \u2063they\u2019d learned \u200cto trust \u2062his judgment. So the ever-calm trader patiently waited \u200cfor Hunter\u2019s inevitable tumble\u2062 from the mountaintop once he ran out\u2063 of bullets \u200band had to turn around \u200band offload\u2063 his\u200b position \u2026 to\u200b no \u200done.\u200d When Amaranth initiated \u2062a fire \u2062sale of \u200ctheir\u2062 non-energy positions just to \u2062meet Hunter\u2019s rising margin calls, The Street knew there\u2063 was blood in the water.<\/p>\n<div id=\"attachment_663539\" style=\"width: 391px\" class=\"wp-caption alignnone\">\n<p id=\"caption-attachment-663539\" class=\"wp-caption-text\">Cover design: Cody\u200d Corcoran\/Post Hill Press<\/p>\n<\/div>\n<p>The besieged Canadian\u2019s problems only worsened when on August 29, \u200d2006, the expiration day of the September \u200d2006\u2062 contract, he decided to \u2063make\u2063 a huge play \u200bby selling \u2062more of the \u2064September futures and buying the October \u2062throughout the \u200dcourse of \u200bthe day. Since \u2064he owned the more expensive leg, he \u2064was effectively long the September\/October spread starting at 36\u200c ticks October over. By noon, his selling \u200bof September and \u2063buying\u2062 of \u200dOctober had\u200b pushed \u200cthe \u2063spread to as wide as October trading 50 \u200dover September \u2026 meaning what Hunter was short (September) was falling more than what he was long (October).\u2064 The trade was moving\u200d in his\u2063 favor. Or, more correctly, he was\u200d muscling \u2062it his\u200b way.<\/p>\n<p>Given the \u200csheer size Hunter was trading, \u2062he \u2063inevitably\u2062 widened\u2063 the differential between  <\/p>\n<h2> \u2063 What factors allowed the fund manager to maintain his \u2064position despite the mounting losses and the challenging period?<\/h2>\n<p><span>  Ather disturbance. The\u200d fund manager, who had built \u200ba solid reputation over the \u200cyears, \u200bhad never experienced such intense pressure before. He knew that he \u200dwas right with his\u2063 trade, but the relentless buying from Hunter made it \u200ddifficult to maintain his position.<\/p>\n<p>As the days went by,\u200c the losses piled up,\u2062 taking a toll on the fund manager&#8217;s nerves.\u200d He could see\u200d his once-promising profits turn into \u200dsignificant \u2063losses. The\u200d pressure was becoming unbearable, and \u200bhe \u200bcould feel the weight of his responsibility towards his\u2062 investors.\u2064 The thought \u200cof jeopardizing their <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/watch-bidens-ed-secretary-takes-heat-after-again-trashing-parents-for-acting-like-they-know-whats-right-for-kids-2\/\" title=\"Biden's Education Secretary criticized for belittling parents' opinions on children's welfare.\">hard-earned \u2062money<\/a> \u2063was\u200d agonizing.<\/p>\n<p>Despite the mounting losses, the fund manager held\u2064 on, convinced \u2064that the\u200b market would \u2062eventually correct itself. He knew that Hunter&#8217;s attempts to squeeze \u2064him out were nothing\u200d more \u200dthan temporary tactics. He believed\u2063 in his fundamental analysis and had\u200c the courage to stay the\u200c course, even when \u2064it seemed almost impossible.<\/p>\n<p>It was a challenging period, both mentally and financially, for the fund manager.\u2062 Sleepless nights and constant monitoring\u200d of the market became the norm. \u200dHe\u200d questioned his <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/the-uvalde-school-shooting-was-a-failure-of-leadership-not-gun-laws\/\" title=\"The Uvalde School Shooting Was A Failure Of Leadership, Not Gun Laws\">decision-making abilities<\/a>\u2064 and wondered if he had overestimated his trading\u200b skills. But deep down, he knew that\u200c giving up was not an option.<\/p>\n<p>And then, finally,\u2062 the tide began to\u200b turn. Hunter&#8217;s relentless\u2062 buying started to\u2062 subside, and \u2063the \u200cmarket\u200d began to reflect its \u2064true \u200cvalue. The losses that had \u200dhaunted\u200c the fund manager transformed into profits once again. It was \u2063a\u2062 vindication\u200c of\u2062 his convictions and a testament to his\u200d resilience.<\/p>\n<p>This story of the big\u2064 dog and the\u2062 fox \u200dis an example of the volatility and unpredictability of the financial markets. It portrays \u200bthe struggle between those who try \u200cto manipulate the market for their own \u200bgains and those who stay \u2064true to their principles\u200b and beliefs.<\/p>\n<p>While Hunter&#8217;s actions may have caused havoc for many, they also presented opportunities for\u2064 those\u2063 who were willing to stand their ground. The\u2062 fund manager in \u200bthis story exemplifies the determination and courage required to weather \u2064such storms.<\/p>\n<p>In the end, it is \u200da\u200c reminder that success in the financial\u200c world requires not \u200conly knowledge and skill but also the strength to \u2064stay true\u2064 to\u2062 one&#8217;s convictions in\u2064 the face of adversity. The big dog may have initially seemed invincible, but it was the \u200dfox&#8217;s unwavering determination that ultimately \u2064prevailed.<\/p>\n<p>And so, as the\u2062 markets continue to fluctuate and test the mettle of traders and investors alike, \u2064it is essential to remember the lessons taught \u200cby this tale\u2062 \u2013 to remain steadfast, to trust in one&#8217;s analysis, and to have the resilience to withstand even the most challenging of circumstances.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In &#8220;Life In The Pits: My Time As A Trader On The Rough-And-Tumble Exchange Floors&#8221; by Brad Schaeffer, Brian Hunter&#8217;s incredible loss of nearly $7 billion in just one week is highlighted<\/p>\n","protected":false},"author":366,"featured_media":2117621,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[541],"tags":[],"class_list":["post-2117620","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-daily-wire"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2117620","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/366"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2117620"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2117620\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2117621"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2117620"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2117620"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2117620"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}