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In a message dated 4/11/00 9:12:37 PM Pacific Daylight Time, grt@xxxxxxxxxxxx
writes:
<< While not familiar with your quotation, I thank you for it. >>
Guy,
Its not my quote but a quote from someone who wiped out a $100 million dollar
fund and then went more than $20 million unsecured. The whole industry knew
he was going to go bust sooner or later. He surprised everyone and managed
to trade without stops for quite a while.
I think that worrying about floor brokers running stops is mostly just trader
paranoia. In most cases they would have to spend too much money to do it.
Why would someone trade 500 contracts to pick off a five lot stop order?
Doesn't make sense. Now if they could trade five lots to pick off a 500
contract stop order that would make sense. In my opinion the fact that stops
sometimes get raided is not a sufficient reason not to use them. I think
they are very necessary and if they are set properly they save money in the
long run and perhaps prevent a catastrophe like that suffered by Neiderhoffer.
Chuck
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