Is the Game Really Rigged?

Is the Game Really Rigged?

Posted On January 28, 2021 2:55 pm

Several online brokers, including Robinhood and Interactive Brokers, have restricted trading of GME and AMC due to the recent mania in those stock prices. 

At best this is a bad look that plays into the accusations of the WallStreetBets crowd, who say the markets are rigged and retail investors don’t get a fair shake. 

At worst, it proves the accusations.  

The real question is, for decades Wall Street has been telling retail investors that they don’t know enough to manage their own money and should just trust the experts.  If the “experts” (read fund managers) know so much, how did they end up with losses that might bankrupt them in this fiasco?

To add to the poor optics, we have guys like Chamath Palaptima tweeting to his million or so followers the options position he took, then exiting that position for a profit before announcing that he was exiting. 

Again, I am not suggesting that Chamath did anything wrong.  Talking your book is common online…

But it sure does look bad all things considered. 

While some retail investors made some money, and a few made a LOT of money…

Those holding GME today got hit hard.  

The WSJ reported that after the online brokers restricted trading, the stock dropped 40%.  That will have likely changed some by the time you read this, however it underlies one of my basic trading premises. 

Solid positions and grinding out gains.

This kind of mania always ends, and it usually ends suddenly.  

If you are the person holding the potato when it does end, you get burned.  

That’s why in my own trading and in Options360, I stay in my lane.  Speculation is not part of what I do, and I don’t believe it should be part of what you do. 

Even if you win once, twice, or even three times…

The time you lose could mean you lose everything. 

That’s why we rarely make 150% in a day, but at the end of every year since we launched in 2015 we have destroyed our benchmark, the S&P 500.

If you want to play roulette, go to Vegas.  If you want to build wealth with a reliable vehicle – I’ll put the Options360 track record against any other in this business. 

And you can still take a test drive for just $19

To Your Success,



About author

Steve Smith

Steve Smith have been involved in all facets of the investment industry in a variety of roles ranging from speculator, educator, manager and advisor. This has taken him from the trading floors of Chicago to hedge funds on Wall Street to the world online. From 1987 to 1996, he served as a market maker at the Chicago Board of Options Exchange (CBOE) and Chicago Board of Trade (CBOT). From 1997 to 2007, he was a Senior Columnist and Managing Editor for TheStreet.com, handling their Option Alert and Short Report newsletters. The Option Alert was awarded the MIN “best business newsletter” in 2006. From 2009 to 2013, Smith was a Senior Columnist and Managing Editor for Minyanville’s OptionSmith newsletter, as well as a Risk Manager Consultant for New Vernon Capital LLC. Smith acted as an advisor to build models and option strategies to reduce portfolio exposure and enhance returns for the four main funds. Since 2015, he has worked for Adam Mesh Trading Group. There, he has managed Options360 and Earning 360, been co-leader of Option Academy, and contributed to The Option Specialist website.