That is to say I have repeated what I was told. And it’s funny — I was all set to go to battle stations over this: 1) The close is not the same as how bad it was intraday. 2) Yes, the SIPC and CFTC have controls and he was able to access his account eventually after the profit opportunity was gone. 3) He was a sophisticated investor, and if Knight had retail accounts he might have been with them.
But in retrospect it’s too clever - it’s much more likely in my estimation that the dude in question with whom I worked was simply full of shit. He tells a bad beat story and it’s not like any of us asked to see statements. It never even occurred to me to doubt it until now.
The Knight trading misbehavior bid the market up, not down. It didn't make its intraday lows until about 12:30 and the S&P500 never fell by more than 1%. Maybe if the puts were on Knight itself ...
That is to say I have repeated what I was told. And it’s funny — I was all set to go to battle stations over this: 1) The close is not the same as how bad it was intraday. 2) Yes, the SIPC and CFTC have controls and he was able to access his account eventually after the profit opportunity was gone. 3) He was a sophisticated investor, and if Knight had retail accounts he might have been with them.
But in retrospect it’s too clever - it’s much more likely in my estimation that the dude in question with whom I worked was simply full of shit. He tells a bad beat story and it’s not like any of us asked to see statements. It never even occurred to me to doubt it until now.