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him Shatz contracts, then closed their equivalent on
another market. Because the Shatz was a seldom used
contract it had a massive spread and Badger simply laid off
the exposure. He hedged his bets and waited to close his
illiquid position when someone eventually bought the
contract off him. Thanks to a giant spread, the whole
torturous process had a tidy profit attached. It was practi-
cally risk free but tedious. With a bit of luck he could make
a million a year for the firm. Not bad, but not exactly great
either. Whatever happened, Badger just sat tight and
grabbed what contracts came his way. Some days nothing
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would happen and on others, like the day of the attack, the
contract was alive and kicking and he could make the
trades necessary to complete the profitable sequence over
and over again all day long.
Then his tedious days of staring at a motionless screen
were repaid. Instead of the usual mind-numbing dearth of
activity there was a deluge of action. While his streak was
nothing when compared to Moby s colossal bonanza he
didn t care, he was no great white whale.
Jim saluted Flipper, who was camp and fat, not as fat as
Joe, porcine rather than elephantine. He had a tendency to
roll his eyes and lisp and he was the purveyor of a 360-
degree mince that rotated around the small of his back. He
could be moody, especially when he lost money. Flipper
wasn t to be confused with Nipper. Flipper did something
similar but different from Nipper. He decided which way
the market was trending in whatever market he felt good
about. He jumped on the trend he thought he saw and stayed
aboard until he thought it had ended or was going against
him. He was right more often than not.
Nipping was a different trick. If Nipper thought the
market was going up he d sit on the lower-priced bid with
an order to buy. If he thought it was trending down he did
the opposite. At some point, hopefully, someone would fill
his order. When one of Nipper s orders got filled  say, a
share that was trending higher  he immediately placed it
back on the order book somewhere a bit higher up, waiting
for the direction of the market to push the price up and take
the shares back from him for a profit. While Flipper hung
on to a share as long as he thought the trend would last,
Nipper rotated stocks or contracts from one side of the book
to the other, hoping the trend would give him some margin
of error.
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Muppets, as they were known on the floor, common
traders and speculators, didn t understand the importance of
the  bid and  ask .
This small difference between the price you can buy and
sell at is the margin that the market makes to survive on. In
the long run, every market move up is cancelled by a move
down, but the spread between bid and ask is always there,
chipping away. The profit from a plunge is cancelled by the
loss from a rally so that the only real profit to be had is
made by capturing the difference between the bid and ask
as traders trade backwards and forwards. All other profits
are illusory, a trick of statistical probabilities that ensures
most traders lose while the odd lucky winner ends up
thinking he s a genius.
As such, Flipper was playing a mug s game, the impos-
sible task of making money from market direction, while
Nipper was making it from the only winnable game:
scalping the spread.
Everyone knew the market was random but no one
believed it. They had to believe beating the market could be
done, and while they worked on it they found ways of
making a living, eking out profits from wrinkles like the
spread. Then along came Jim. With a flash of his felt-tip pen
he could give Flipper a trend to sit on all day. Flipper was
no longer an institution muppet, he was a winning trader,
riding his rock-solid trends for bumper profits. If only
Fuch-Smith would give him more capital to risk he d be
making all the money in the world, but there was no
convincing him to give Flipper more rope to find a way of
hanging them all. A decade s profits were in the bag.
Everything else was just to be looking busy.
Surely Jim was just a lucky winner. He d read the theory.
There were seven billion people in the world and one would
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trade randomly like a seven-billion-to-one winner. He
might be that particular lucky fellow. Perhaps just being a
billion-to-one trader would be enough or perhaps, in a
world of chance, he might be the ten-to-one possibility that
some guy could have ten times the luck of seven billion
people and be a seventy-billion-to-one winner. Such a guy
could put a dollar on the red and watch it come up red
thirty-six or more times and leave the table with sixty
billion dollars as a result.
What someone like that could do with the leverage of a
major bank behind him was anyone s guess, but certainly
every winning streak had finally to end, and if the lucky
chap kept gambling he would eventually lose his shirt.
Jim, the trading Moby, was just a big egg-timer of luck,
dripping it out a grain at a time until one day it would all be
gone and his chart lines would be as irrelevant as everyone
else s.
 Happy New Year, Dirk, said Jim.
Dirk didn t look up from his screen and simply raised his
hand. If asked he would have said that he  fucking hated
Moby. He was a fundamental trader. As a good old hedge-
fund manager-style dealer, he took macro-economic trades
and tried to back them in such a way that he couldn t really
lose. In theory this sounded great, but in practice Dirk was
always exposed to something.
On the big day, market volatility blew up all his expen-
sively laid positions, which were balanced by a vast convo-
luted structure to make money out of the fact that, as the
future came and went, people overpaid for the insurance a
future or option could offer them. The attack had created
such massive volatility that his strategy was immediately
fifty million pounds in the hole. What had been expensive
insurance that he was selling short before the attack was
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now utterly cheap and rocketed up in value.
The moment the attack kicked off, Dirk was over; his
arse was going to get fried. When they broke down his
pyramid of dealing they would find that he was about as
safely hedged as a nudist running down the street waving a
bag of crack cocaine. He couldn t even start to calculate the
size of the financial hole he had dug. Everything had gone
to fuck.
He d have to wave goodbye to his massively over-mort-
gaged flat in Docklands. His wife would leave him when he
had to take the kids out of school and suggest that the only
way to pay off the credit cards was for her to get a job. He
was more fucked than a blonde on roofies at a Hell s
Angels jamboree. As he had looked at Moby s insane
monitor scrawlings, he laughed. There was only one logical
way out. He was dead meat anyway, so he immediately
bought millions of pounds worth of the most whacked-out
long options he could get onto. He filled his boots with
long-shot toxic crap derivatives; with the bank s no-limit
capital, there was nothing to lose but more. By sunset he
had made his position back and put another hundred million
up on the scoreboard. It was like falling from twenty thou-
sand feet and landing unharmed in a swimming-pool of
naked supermodels. How could he not hate that fucking
know-nothing Moby? What was the point of his life if it
took some spotty kid to pull him out of the shit and not even
know how he d done it?
Jim sat down next to Nipper.  Got any antacid, mate?
 Green or red, Zantac or Tagamet?
 Ooh, I ll take a red and a Tagamet, please.
 Right you are. Nipper handed them over on a sweaty
palm.
 Sorry to hear about your grandmother, said Flipper.
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Jim smiled sadly.  Thanks. He brought up the chart of
the last close. It was clearly going up, so he waited for the
open, at which he would hit the offer for a couple of ticks,
sit back and watch it rise.
He looked around the floor. There were about thirty
traders down his end and he realized that only about a dozen [ Pobierz całość w formacie PDF ]