XIV Trader Loses $4 Million And 3 Years Of Work Overnight: Here Is His Story

Original post

The devastating 90% overnight collapse in the now “terminated” XIV Exchange Traded Note (ETN) has had many casualties – from one hedge fund down as much as 65%, to Morgan Stanley’s (formerly) $39 million position, to Reddit user /u/Lilkanna who posted “Ive lost 4million USD, 3 years worth of work, and other people’s money” in the “TradeXIV” subreddit. 

“1.5 mill was capital I raised from investors who believed in me,” Lilkanna wrote. “I had a leveraged position I used DTBP to buy and it was down like 1% and I thought I could hold it knowing that I would get a reg-t call deadline in 2 days.”

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As confirmation of his woes, Lilkanna posted a screenshot of his depleted account:

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Close up:

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“The amount of money I was making was ludicrous, could take out my folks and even extended family to nice dinners and stuff,” he wrote. “Was planning to get a nice apartment and car or take my parents on a holiday, but now that’s all gone.”

“Sad thing is I was long VIX until a couple of days ago. I was sure there was gonna be a correction but with each passing day my conviction wavered. Stupid. Really fu**ing stupid. I feel like such a fool.”

While some Redditors were supportive – emoting empathy, “Hey man, I know others have said it but I’m here for you man,” one user wrote. “It may seem like the end of the world but tomorrow is a new day.”

Another Redditor said “Jesus dude, if you were able to turn 36k into 2.5 million (even with raised capital), you can make back all the lost money and then some,” he said. “You just have to learn from the lessons and give it time, you will make it back in no time. It sounds cliche as f**k but you know its true.”

User /u/asianhere commiserated with Lilkanna, writing “I feel you as I’ve lost 1/2 of my net worth today T_T prob 5 years on my life”

For what it’s worth, Lilkanna is able to take responsibility for his epic fail:

I guess you never expect it until it hits you. You always hear stories about how people get cancer and how people get randomly killed in the street or about how they lose all their money, but sometimes you find it hard to believe that it will happen to you.

I started with 50k and traded all the way to 4 mill over 2.5 years, started using more and more margin, started taking it less less seriously, what could go wrong? Arrogance. Stupidity.

Ah well. Thanks for the kind words though. They are more comforting than you realise.

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Credit Suisse, XIV’s issuer, announced this morning that February 20 will be the last day of trading before termination.