My Worst Investment Ever Podcast
Business:Investing
BIO: Noel Smith is the Chief Investment Officer of Convex Asset Management and the Head of Options Trading at Tanius Technology.
STORY: Noel and his partner invested in a stock whose price kept falling. Every time the price would fall, Goldman Sachs would come in and buy like 50,000 out of the money calls. This made the partners hold onto the stock, eventually riding it to zero.
LEARNING: Have risk measurements in place that you know you will not break. Have some percentage that you're willing to lose.
“Learning about options and how they affect the marketplace is much more important than you think."Noel Smith
Guest profileNoel Smith is the Chief Investment Officer of Convex Asset Management and the Head of Options Trading at Tanius Technology.
A member of the CME, CBOT, and CBOE, Noel has over 25 years of experience trading volatility, market making, and managing risk.
Noel was previously the CIO and Portfolio Manager of two separate Chicago-based proprietary derivatives trading firms. Additionally, he was the seed investor who financed the launch of global high-frequency trading firm GETCO LLC (KCG/Virtu), which grew to account for 20%+ of trading volume in the U.S.
Worst investment everNoel and his partner had a position in Enron, the ninth largest market cap company at the time. Enron started to lose money. Each time the stock would go down 10%, Goldman Sachs would come in and buy like 50,000 out of the money calls. Such stunts would convince people, Noel included, to hold onto the stock. And so the partners kept holding onto the stock as the price went up and down. Eventually, they rode the stock to zero, losing their entire investment.
You always have to be able to see the cause and effect of everything.
Noel recommends learning about options and how they affect the marketplace.
Noel's number one goal for the next 12 months is to develop his business and get more people to understand why options are useful and not to be afraid of them.
“Thank you for having me today. Hopefully, everyone got something out of this.”
Noel Smith
Connect with Noel Smith
Andrew’s books
● How to Start Building Your Wealth Investing in the Stock Market
● My Worst Investment Ever
● 9 Valuation Mistakes and How to Avoid Them
● Transform Your Business with Dr. Deming’s 14 Points
Andrew’s online programs
● Valuation Master Class
● How to Start Building Your Wealth Investing in the Stock Market
● Finance Made Ridiculously Simple
● Become a Great Presenter and Increase Your Influence
● Transform Your Business with Dr. Deming’s 14 Points
Connect with Andrew Stotz
● astotz.com
● YouTube
● My Worst Investment Ever Podcast
Brenden Kumarasamy – Follow the Data, Not Your Emotions
Julian Klymochko – Arbitrage Trades Don’t Always Turn Out to Be Risk-free
David Hay – The Importance of Range Expansion
Rex Salisbury – Quitting Can Be a Very Important Skill to Exercise
ISMS 23: Larry Swedroe – Do You Allow Yourself to Be Influenced by Your Ego and Herd Mentality?
Harvey Sawikin – Do Your Own Homework
Paul Krake – Surround Yourself With Experienced People
ISMS 22: Toyota vs. EV Extremists – Who Is Right?
Guillermo Cornejo – Don’t Underestimate the Value of Experience
Eugene Ng – Keep Playing the Long-Term Game of Investing
ISMS 21: CPI Collapsing Across the Globe
Nick Maggiulli – Don’t Buy Individual Stocks
ISMS 20: Larry Swedroe – Do You Extrapolate From Small Samples and Trust Your Intuition?
Larry Shumbres – Invest in What You Know and Is Regulated
Jesse Felder – Don’t Rationalize a Lousy Trade
ISMS 19: 5% March 2023 CPI Could Fall to 4% By Year-End; If Oil Doesn’t Fly
Sachi Wickramage – Target the Customer With the Problem at Scale
ISMS 18: Dave Collum – What Makes Your Investments Good or Bad
Vincent Deluard – Know the Difference Between a Trade and an Investment
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