Your Week Was Not as Bad As…
Brian Hunter’s.
I have had a few weeks in my life in which I lost a lot of money in the stock market. I have grudgingly accepted these occurrences as just part of the world of investing. For the first year or so that I was in the stock market every time I made an investment the stock fell precipitously the next day. It made my stomach twist. But one of those stocks was Amazon and it has played a role in my financial progress. Over the years I’ve learned to be light hearted on these days (mostly).
You can read this article to find out about a very bad week. Last week a trader, Brian Hunter, from Amaranth lost $5 billion. Yes, I wrote billion not million.
I’m not an expert on commodities (the loss was in natural gas) but it seems to me that there was likely a good deal of speculation involved. It would be interesting to know what percentage of the assets controlled were in natural gas.
In reading the Wall Street Journal article (subscription required) it appears that he may have been very leveraged, but the description is not yet detailed enough to tell.
One thing I’m sure of is when I come home to see all my stocks down badly for the day I’m glad I don’t have to face angry calls from investors and ominous calls to preserve my records and meet with regulators!