Journey of 320 USD pt4 “The Avalanche”

Dealing with losses. The Avalanche.

雪崩了，雪球滚碎了。

The main takeaway here is, no amount of hedging is as effective as not greeding it out.

It was a wild ride, 100x my money over a duration of 74 days using 320USD in 100+ trades.

It definitley is a tough pill to swallow. But there are always risk involved espically when you adopted a more degen and risky instrument.

Positions that got me into this mess:

All single leg strategies:

35 contracts of 5DTE at stike on a leveraged Chinese ETF with a significant volatility decay daily.

50 contracts of 5DTE at strike on a chinese meme stock.

20 contacts of 10DTE at stike on a non leveraged Chineze ETF.

Heres the funny thing, their correlation is 85%+ going against all fundamentals and became regarded.

Whatevers beneath the iceberg, My tickers dipped around 30% before market opens, i knew im done for. Then, my confirmation bias kicked in, i bought the dip after suffering a 80+% account loss. Few hours later, the strike prices doesnt even have liquidity anymore. Thats how OTM i am, theyre just rotting to 0 at this point.

But to my astonishment, it sure stung for a short bit, but it barely affected me. Maybe thats because I knew my expectated return over time would be 0 and this is as far as im able to go.

By the way, most losses were profits accumulated prior and i have already taken out my initiail capital. maybe thats how i was able to deal with this setback.

Now that I have been able to handle a 30k loss overnight and I am only 28. The financial market is a dymanic one, Im sure there will be more opportunities

TLDR: The best risk control you can have is by having appropriate lot sizes and not greeding out.

Stay safe out there Fams.

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Avalanche95

Was working in a hedge fund. Started my own JC Econs tuition center 之前效力于一家对冲基金，现在开了个补习班教高中经济。

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