It is hard to feel sorry for hedge funds so I got a chuckle out of this article.
Earlier in the year I got convinced that I could make more money by trading in options like the big boys. I got an options account and then I stopped. I realized I was getting in way over my head and the most likely outcome was losing all my money.
Its reassuring to see the pros get in over their heads and lose money.
VW's 348% Two-Day Gain Is Pain for Hedge Funds
Wall Street Journal
OCTOBER 29, 2008
Hedge funds around the world absorbed a punishing blow Tuesday, as soaring shares in Germany's Volkswagen AG created one of the biggest losses from a single bet in recent memory.
The funds are expected to face billions of dollars in losses, according to prime brokers familiar with the positions, because they were wagering that VW shares would fall. Instead, shares of the big German auto maker soared 82% Tuesday to €945 ($1,185) in trading in Frankfurt after fellow German car maker Porsche Automobil Holding SE said it had boosted its VW stake.
VW shares are up 348% over the past two days and 267% in the past month -- as short sellers rushed to pay ever-higher prices for shares they need to exit from positions.
Those affected by the moves include Greenlight Capital, SAC Capital, Glenview Capital, Marshall Wace, Tiger Asia, Perry Capital and Highside Capital, according to people familiar with the funds.
