SHE DAYTRADES AND THEN TASTES LATTES AROUND THE WORLD!!!
HOW I BLEW UP MY ACCOUNT TRADING APPLE OPTIONS
Disclaimer: This is a cautionary tale.
One I do not wish on anybody.
I am still in pain. Physical. Emotional. Spiritual. Financial. I went long AAPL calls Monday morning August 24, 2020.
I broke all of my trading rules. 1. Never buy a stock at its high. 2. Never buy at the open. 3. Don’t trade in August or until the market has a clear direction 4. Set a stop loss. 5. Never go all in; average in.
But I buy the August 28 AAPL 530 calls right at the open. I go all in and get printed high 8.71. The high. I had studied Apple over the weekend, and it was about to break out over 500 and the split was coming and all the data, charts, statistics show the stock was going to run.
What could possibly go wrong?
It’s Apple. The most talked out, profitable company in the world. Everybody was trading it. Including my friend who works in cosmetics at Saks Fifth Avenue in Beverly Hills. How can she know more about the stock market than me? I was previously a Senior Vice President at Morgan Stanley in New York. I covered hedge funds in an equity sales capacity. I was licensed Series 7 and 63. When she told me she bought Apple at a 52 week high the summer of 2018, I just kept saying, “It’s too high. You’re going to get burned.”
She wasn’t burned. She was up over 100%. Even after market collapse of 2020.
I wasn’t a buyer and holder of stocks. I had seen too much. Besides, I liked quick, easy money.
Monday morning, I never expect the stock to open so high at 513. I had two accounts and I bought 100 contracts in one and 50 in another right out of the gate. My account is down to its last $100k because I was short after March 2020 and got burned by Powell and the Fed and all the liquidity flooding the markets like everybody else who was short.
But with 10 times the profits you can make on options, I could be at over a million dollars in no time, I told myself! That was the plan. And I am the queen of plans.
My options were filled way higher than I wanted them to but my account jumpsfrom $111,000 to $122,000 in SECONDS.
And all I think is this is going to be good…
I should have jumped on this train a long time ago.
And I’m watching …and I’m happy…and this is awesome. I’m making bank.
Until suddenly Apple drops 10 points within seconds. It breaks 500 and my account is disintegrating before my eyes. It drops so fast, I can barely fathom what is happening.
I can’t breathe.
I wait. I take the little money I have left in my account, and I do what some people wrongly do on a losing trade. It’s known as the MORON TRADE. That’s piling MORE ON to a losing trade.
I average down. I buy more contracts.
The stock begins to climb.
It looks like I’m out of the woods.
I now have a $7,000 profit.
Too early to sell, I tell myself.
I want more.
I always want more…
I take a shower. I’m writing a book and need to get cracking on that. When I come out of the shower, Apple is trading higher at 509, but my profits HAVE CRACKED IN HALF.
I’m now only up $2,000!!
This isn’t good, I realize. This is the decay they talk about in options.
I have been asked before a thousand times: “Why don’t you just trade options?”
“Because options expire worthless,” I’d reply.
WHY DIDN’T I LISTEN TO MYSELF?
MOST OPTIONS EXPIRE WORTHLESS!
But not mine. Mine won’t. Because I’m different, I’m special. It’ll be different…FOR ME, I tell myself.
Monday ends up being a bad day. The stock is a behemoth. It takes so much pressure and volume to move it and all I can feel is that it wants to go down.
I’m all in a stock that I never bought before and I never liked. I’m holding at an ALL TIME HIGH. I hated everything the company stands for and even though I have an iPad, I believed that all of this technology was just ruining people’s lives. And all the executives at Apple were pompous and taking over the world with their wealth. I could go on and on, but I won’t. Because it doesn’t matter.
I’m here to tell you what happened to me.
Apple closes down at 502 and I hold it overnight. I’m down over 50%. Maybe more. It’s hard for me to look at this point. My $111,000 account fluctuated between $122,000 and $59,000 with these options and it was a rollercoaster ride.
One I wanted to get off.
The stock went up after hours and I thought everything would be fine.
But I didn’t sleep because I kept watching futures.
At 1 in the morning, someone posted that Apple was trading at 111 in the overseas markets. We were all overjoyed. Our calls will be saved! We will live to trade another day!
I finally fall asleep and I wake up 4 hours later. I grab my phone and I check pre-market. Futures are up and Apple is red, down 3 points.
EVERY TIME I HAVE EVER CHECKED APPLE IN MY LIFE, IT WAS ALWAYS GREEN, ALWAYS UP.
And as soon as I buy it, it turns.
Isn’t that always the case?
I feel sick.
I watch the open.
If I there ever was a time I could give back one trade – this would be it. All traders should get one chance at a DO OVER. A redue. That one bad trade they could give back.
I open my Etrade account and my balance is $42,000.
I am f*ed.
The stock is dropping.
How could this be happening?
Apple only went up. Didn’t it?!!
I can’t breathe.
I have been in this situation before, and now I’m on my last shred of patience. Between the quarantine and being so isolated for the past six months, my day trading has gotten off the rails. I weigh 90 pounds. That’s very thin on a 5” 5 body. I study trading 20 out of the 24 hours of the day. Because my car is dead from not driving it and I have no where to go anyway, I walk to the grocery store for food. I tried Instacart, but who wants to pay $5.99 for a package of Oreas? The groceries are heavy and I lug laundry detergent and liters of water ten blocks home. I am only able to buy what I can carry. My arms are ripped from carrying these bags. (pun intended; the grocery bags and my trading bags) I am sunburned because the only escape out of my apartment is to jog 10 miles on the beach everyday. It hasn’t been the easiest summer or year for that matter.
But some days were great.
The days that I am winning.
The days that I am trading and making $3,000 – $14,000 a day.
The days that I am losing, it’s hell.
Pure, unabridged, hell.
I don’t have that much money to begin with.
I was putting my unemployment money into my Etrade account.
I didn’t know when I would get work again.
Things were pretty damn bad no matter which way you sliced it.
And my world got very small. My friends; it was hard to talk to them sometimes. Usually in a friendship, one calls the other with good news or bad news and you either listen and console or congratulate them and buy them dinner! But now, everybody was in the same boat. Everybody was sad, depressed, worried. Nobody could go anywhere. Nobody had any good news. The conversations became fewer and farther between.
Trading was my life.
It had always my life. But now it was really my life.
In a big scary way.
Because I had nothing else going on.
I watch as Apple goes lower.
I’m not getting out of this alive, I realize.
I call Etrade and I’m on hold for 40 minutes. I see there’s a way I can “roll the options,” but have no idea what this entails. I need more time. This thing needs to jump by Friday! Or it expires worthless! I’m in the August 28 calls and I have everything riding on this.
As I’m on hold, Apple starts to rise.
There’s hope, I tell myself.
I hang up. F Etrade. I’m a trader. I know exactly what I’m doing. At all times. I decide to take a shower and come back to it in a few minutes.
I do and the stock goes lower.
My account is now under $30,000 and dropping fast.
I call Etrade again and wait another 30 minutes on hold. I am praying I get someone smart on the phone. Someone who has an answer for me. Being that I worked on a trading floor and most of my work was done over the phones; I had a very quick read of someone within the first 5 seconds of speaking to them on the phone.
A guy finally gets on the line. He’s young, but he seems to be calm and knowing.
What I do next is something that I never do.
I can’t help it.
I start crying.
The conversation, from what I can recall, goes something like this: “I don’t know how this happened. How can $120,000 be wiped out in not even twenty-four hours? This is everything I have. I can’t lose this money. What are my options?”
On these options that are destroying my life?
He stays calm.
He doesn’t make fun of me.
He doesn’t laugh, he doesn’t yell.
He doesn’t say, YOU STUPID, STUPID GIRL. WHAT HAVE YOU DONE?
But I’m embarrassed and ruined. “It’s APPLE,” I say, “how can this go down? If I roll the contracts, will that buy me some time? What about the split – will the split help the contracts by doubling?”
I’m grasping at straws.
He can hear it in my voice. I’m desperate.
I hear him breathe on the other line. His voice doesn’t change. He’s steady.
Thank God for this. Thank God.
He is the life jacket right now and I am drowning.
I am blowing up.
He puts me on hold.
Apple ticks up. It’s trading at 495 now. But I am still so f*ed! I BOUGHT CALLS AT 512! AT THE ALL TIME HIGH!
I wanted to kill myself.
Honestly, as I’m lying on my couch, waiting for him to come back on the phone, I wish that I am dead.
I thought about buying protection because the LA protests were so horrendous, but I could never shoot anybody. I could never live with myself if I hurt anybody.
But I had no problem with hurting myself.
But I didn’t have a gun or the nerve even if I did have one, but I wanted to die. In this moment, I wanted to not be alive. And it wasn’t the first time I felt this way trading.
He gets back on the line.
Now I can hear his voice shaking.
“Umm Juliana, yeah….” He begins, “Ummm well, it looks like… basically….”
I hold my breath.
Give me something.
Give me something I can hold onto. Please.
“Basically, the split is going to impact your options, it looks like, in a negative way…”
I tune out for the remainder of the conversation. I only watch the stock and its dropping and every second we are on the phone debating this, I lose more money.
Apple trades at 494 and every time I hit refresh on my “APPLE iPad,” (how perfectly maddening) my account fluctuates up and down $3000.
I have $26,000 left.
I ask, “What’s the breakeven price I need to get to on Friday to get out of this?”
“Let me figure that out for you.”
I wait. I should know this myself. But I can’t even begin to figure it out because I’m so panicked. I can’t imagine what I’m going to do for money if I lose everything. I can’t imagine how I’m going to survive. What’s worse was, WHAT ON EARTH WILL I DO ALL DAY LONG IF I CAN’T TRADE?
He gets back on the line. “The options look like they need to hit… 537 Friday.”
No way in hell was Apple going that high by Friday. Unless there was a miracle. And I needed one now.
The whole market is red and it looks like it’s rolling over. Everybody in the SPY message boards was saying that the market was so TIRED, it’s spent. GOING DOWN MOFO’s. And always in the back of your mind, every trader wonders, is this the beginning of the crash?
Because we all know it’s coming.
But until then… Ride it out…ride it out for as long as you can… And don’t be the last one out the door.
“So should I wait?” I ask, knowing the answer to my own question. “To sell?”
If I wait and the options don’t hit 530 Friday, they will expire worthless, and I will lose everything.
The account will be zero.
If I sell now, I can walk about away with the measly $26,000.
“Can you sell for me? Can you just get me out of this with $26,000?”
I didn’t think I could do it myself. But I knew the rules. By the time he walks me through the long verbal DISCLAIMERS that he has to read to place the trades, I will only lose more money. It will take too long.
And I had to sell this second. This trade is getting further and further away from me.
I think pretty much I just blacked out after this.
The moment reminded me of the day at Veterinarian’s office when my cat died. I was with the Doctor and it was time to put him down but I BEGGED AND PLEADED, “Please Doctor, I don’t care how much it costs, can you please just keep him alive a little longer?”
I paid and paid until the money didn’t matter anymore. It wouldn’t save my cat anymore.
That was this day.
I remembered as I stared into the Doctors eyes watching as he shook his head at my utter grief. He was quiet and soft spoken, very similar to this Etrade guy, and he said, “There is nothing more we can do.”
And I hear the Etrade guy say, “There’s nothing more you can do if the stock continues to go down.”
And here I was, reliving that day.
The saddest, worst day of my life.
When the doctor told me this at the Vet, I took my cat outside for one final goodbye. We sat on the curb on Sunset Boulevard and he was in my arms and I cried and I cried and I cried.
I got up and brought him back inside so the doctor could put him down.
It was over. It was the worst moment of my life.
Now I was putting my account down.
As all this is happening, I realize the Etrade guy is no longer on the phone and I am crying again.
He had left me alone to end my account.
The same way the doctor did with my cat.
I hit the bid and I click, “Execute trade.”
And it’s done.
My account is dead.
* * *
The rest of the day, I am a zombie. I call my best friend Ginger in New York. “I’m coming home,” I tell her. “I lost everything. I need to get a job. I need to get my life on track.”
The idea of this rattles me. The idea of going back to work after making thousands with the click of a mouse for years and being around people I probably won’t like just pushes the knife further into the wound.
I try to put a positive spin on it. “My Dad, Ginger,” I keep saying, “He will be glad to have me home. I’ll just go back to work. I’ll get an Executive Assistant job at a hedge fund. I can make a good salary…”
She agrees and she listens.
I cry some more.
We are on the phone for two hours.
I can’t get off my couch.
I haven’t eaten. And I haven’t slept.
And now, I can’t trade.
The thing I spent 90% of my thoughts and my time on, was done.
It was better than a lover and I was obsessed with it. I always was.
“It’ll be good for you,” she kept saying.
When we hang up, I can’t sit alone. I need to call someone else. I call another friend, Bonnie. She was older and like a mother figure to me. My mother was abusive, both physical and verbal but I stopped hating her for this becauseI knew she didn’t mean it and she couldn’t help it. As a result, I was able to endure a lot of pain. This came into handy while working on Wall Street. Whether I was on a trading floor trading money for other’s people’s account or trading for my own, you couldn’t knock me down. The fight was always, “You got me this time, Mr. Market, but I’ll be back. I will come back and I will win.”
As if somehow, if I beat the market, I was getting my mother’s approval.
Only it never happened.
And if it did, it was fleeting.
This was the same pattern. Lose money, blow up, go back to work. Amass enough when you can trade again. Blow up. Rinse, repeat.
Stupid. On every level.
Bonnie, asks, “How’s it going, Juliana?”
But I can’t speak.
She told me for years I had a “gambling problem.“
My money was none of her business, I’d tell myself. I’m a F*ING TRADER. I CAN AND DO BEAT THE MARKET ON A DAILY BASIS. TODAY WILL BE NO DIFFERENT.
But today was different.
I blew up.
WHO LOSES MONEY ON APPLE??!?!
I start crying again. She’s never heard me cry. Crying is for wimps. You can punch me in the stomach and knock me down, but I’ll get up bruised and battered and beatened, but I always will rise again.
But I had no fight left in me now.
And I couldn’t keep living like this.
My life was contingent upon: am I up or down?
Did I make money or lose money?
Is my account high or low?
And the truth was: it was never enough.
Here’s the numbers: the true numbers of my trading history over the past few years. For a real trader, the numbers is better than porn in my opinion. In February 2018 I was long TVIX, trading and making bank on volatility until the trade went against me. My account was about $150,000. But it got chopped in half because volatility goes down so quickly. So my $150,000 quickly turns into $75,000. I know these numbers are small to some people. To other people, they may be big. But it was all I had. So what did I do?
I call the bank and I get a cash advance on a credit card for $40,000. I dump it all into TVIX to average down.
The stock continues to crater.
I got more bank loans. 7 in total. Or was it 8?
Who was counting at this point?
I end up in over $70,000 in credit card debt.
Then TVIX reverse SPLITS 10 FOR 1.
I stay in and I don’t let go.
I keep averaging down.
For years, I was in turmoil, stressed out and broke.
In February, 2020, my Etrade account was at an all time low and my debt at an all time high.
I was about to file for bankruptcy.
What choice did I have? My Etrade balance $18,000. I had $80,000 in credit card debt and no job. I was putting my rent on credit cards and my credit cards were tapped out!
Two weeks later, CUE IN THE STOCK MARKET CRASH OF MARCH 2020!!!
JUST LIKE I ALWAYS EXPECTED….
I’M BACK IN ACTION!
MY ACCOUNT CATAPULTS TO $311,000!!!!!!
I sell TVIX at 402!!!!
I’m a star on Stocktwits!!! I have a blog and people are flocking my website and I’m making money on my Google ads.
LIFE IS GOOD!
The first month in the quarantine, I make another $40,000. I only used a small portion of my account to trade with, and I would go long and short volatility at the same time. I was hedged.
But I was short vol when TVIX hit 1000.
I got a margin call.
But TVIX drops back down the next day.
I am saved.
This was how I lived.
On the edge. Always on the edge of blowing up.
Because could there be any other way?
Then, I start losing real money. Powell comes along and ruins everything. I decide to pay off the debt. I take a massive hit on my account, I was long UVXY and volatility was tanking and I lose $50,000 on that trade, and I move out $70,000 to pay off my debt. Now my account is $201,000. From $311,000.
I’m going to stop trading, I tell myself.
The market is untradable.
It’s too manipulated.
I will hold off.
This lasts a few days.
Or maybe a few hours.
All I know is that before long, the mouse is back in my hand and I am winning again. I am winning until I am not.
I’m all in TVIX and it’s going higher, and the market looks like it’s tanking again with the resurgence of Covid and how could we POSSIBLY GO UP IN SUCH TURBULENT TIMES – BUT WE DO.
Not only does the stock market go up – it catapults up higher at levels unheard of before.
Shorts are dropping out like flies.
Active traders gone.
At this point, I’m all LONG TVIX AGAIN as if I didn’t LEARN MY LESSON THE FIRST TIME.
And I’m losing and the news comes: TVIX IS DELISTING! I am forced to take a massive hit and sell.
I’m down another $70K and so I pile what’s left into UVXY, and that goes down,and I lose more.
I call my psychic as if she can save me when I’m down to my last $93,000. She says, “I know it’s crazy to hear, but the market is going to keep going up. Don’t drain what you have, sell now and take the loss. Go short at a later time. 2021,” she says.
So I listen.
I take another massive hit.
She was right.
The market went higher.
I pump more unemployment money in and get my account back over $100,000 and I trade and make more until I’m up at $111,000.
This is when I learn how to trade options on UVXY. I master it and I’m making $3,000 -$4,000 daily. My goal was to make $1,000 a day trading.
And then I realize I can make even more if I start trading Apple calls. Out of the money Apple calls.
Because Apple only goes up? Right?
So as my mentor is asking me, “What happened Juliana?” I know she is going to rip me a new one.
“I lost it all.”
I am speechless. The shock rolls over me like a bad dream.
“What do you mean, everything?” she pushes.
“My trading account. I blew up. Down to $25,000.”
She says, “Well, you didn’t lose EVERYTHING, you still have $25,000 left.”
And then I feel hope.
I CAN TRADE THAT 25K AND DOUBLE IT, TRIPLE IT, AND GET MY ACCOUNT OVER A MILLION DOLLARS. I CAN GET MORE BANK LOANS. I CAN JOIN ON OF THESE TRADING COMPANIES LIKE MAVERICK TRADING AND TRADE WITH THEM…I CAN COME BACK!
I ALWAYS COME BACK!
And suddenly, she says, “So what you’re really saying, what you are really trying to tell me here, is that you hit a bottom in your gambling addiction.”
And there it is.
Her words sink in.
And the instant I say it, it’s a load off.
We talk more. At the end of the conversation, she asks me if I know of anyone who has a gambling problem and suggest I reach out to them for help. And if you don’t know anybody who blew up worse than you have on Wall Street, you’re not a real trader.
So I call my friend Daniel and it’s like he was expecting my call. He has taken me to some of his Gambling meetings before and I hated them.
But what I hated worse was what I had become.
I didn’t recognize myself.
If you looked at me, you would think I spent every waking hour in a gym and at a tanning salon. My body was hard and tan and this was only because I had to carry groceries and I was so stressed out with anxiety and I had no other outlet in life but to run on the beach.
I didn’t see anybody and I didn’t talk to anybody. It was me and my trading, my writing, the beach, my cozy apartment.
I got what I signed up for. I was living the dream.
I HAD GOTTEN WHAT I ALWAYS WANTED! Didn’t I??!!
But truth was, I running a small $100,000 account and I was obsessed with it. And was trying to make it go back to $300,000 or $3,000,000 even worth this?
When would $3,000,000 need to be $30,000,000?
Was anything worth this?
What was I contributing to the world?
I felt sick.
I couldn’t go on.
So for the first time, I admitted, “You’re right. I have a problem. I will stop trading. I’ll get help.”
* * *
The next morning, I wake up and the first thing I want to do is check futures. I wonder where Apple is trading and if it’s higher and if I held on, would I have gotten more money?
Or would I be left with nothing?
But I don’t check.
I can’t look.
I feel sick and I have no energy.
I need to reinvent myself.
I need to get a real job like a normal person and make a living. I needed a routine and I needed to be in the flow of life.
Maybe this is the best thing to have happened. I don’t know. And I don’t know if I am done with trading.
Why am I writing this?
I don’t know.
Am I embarrassed? Sure. But there is nothing anybody can say to me right now to make me feel any worse than I already do. I have scraped the bottom of the barrel. I have found that small hole and I have fallen through it. I was in free fall and I crashed hard.
I can’t say for certain that I will never go back to trading.
But maybe I will try.
* * *
H E D G E D
@copyright Citygirl Juliana Jones 💕💋
Don’t give up my fellow traders! Better days ahead!
Yours, Citygirl 💕💋
To see some of the losses and trades, click here:
For more random chapters of my novel, click here:
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For Chapter One click here:
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For Chapter Two, click here: