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
Igor Yelnik – Think About Non-Market Risks
Bogumil Baranowski – Be Careful With Businesses in Secular Decline
ISMS 17: Larry Swedroe – Do You Project Recent Trends Indefinitely Into the Future?
ISMS 16: Top 5 EM Country Interest Rates – Normal China Yield Curve
ISMS 15: Top 5 DM Country Interest Rates – Steep US Inversion
ISMS 14: Regional Interest Rates - Low in Asia, Egypt and Frontiers on Fire
ISMS 13: Global Interest Rates - Hikes Slow, Inversion Signals Recession
Peter Ricchiuti – Don’t Fall in Love With a Stock
Jason Hsu – The Market Can Be Crazy for Longer than You Have the Conviction
Shreekkanth Viswanathan – Qualitative Strengths of a Company Matter Too
Jeremy Kokemor – Tread Carefully When Investing in Metals and Mining
Paul Hodges – There’s No Substitute for Judgment
Amy Minkley – What Is Your Enough?
Benjamin Claremon – Know What Kind of Investor You Are
Edward McQuarrie – Never Ever Sell Naked Calls
ISMS 12: CPI Racing Across the Globe
ISMS 11: US Banking Crisis and Fed Rate Cut
ISMS 10: US CPI Could Decline to 4% By YE23; Unless QE Revs Up
Michelle Leder – Read the 10-K Before You Buy That Stock
ISMS 9: Saving Silicon Valley Bank Brings New Risks
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