James Cordier, the founder of OptionSellers.com, recently delivered an apology via an emotional video to clients stating that losses from sour bets on energy prices would likely lead to the untimely demise of his firm, according to recent reports under review by investor rights attorney Alan Rosca.
Cordier’s video acknowledged the sharp swings in the energy market that led to severe losses which will most likely affect up to 290 clients, each of whom held firm minimum investments of $250,000.
You were my family, and I’m sorry that this rogue wave capsized our boat.
OptionSellers.com had to start liquidating its positions last week after wrong-way options bets on oil and natural-gas prices which led to losses which shocked investors and traders in both the options and commodities industries, according to a report form the Wall Street Journal.
The Journal goes on to note how OptionSellers.com had specialized in selling options contracts to collect income.
James Cordier, the firm’s president and head trader, recently explained the firms’ strategy:
Our goal is to take an aggressive vehicle and manage it conservatively.
In reality, however, Cordier allegedly traded naked options rather than covered options, which reportedly increased exposure.
Alan Rosca, of the Goldman Scarlato & Penny PC law firm, is investigating activity related to OptionSellers.com‘s alleged commodities fraud scheme. Investors who believe they may have lost money in activity related to OptionSellers.com‘s alleged commodities fraud scheme are encouraged to contact attorney Alan Rosca with any useful information or for a free, no obligation discussion about their options.
OptionSellers.com reportedly suffered a catastrophic loss after oil plummeted over 7% on November 13, according to reports under review by investor rights attorney Alan Rosca.
This drop purportedly left clients with a negative balance and put them in debt to INTL FCStone Inc., OptionSellers.com’s clearing firm, according to reports form the Journal. Said accounts managed by OptionSellers.com were forced to be liquidated because of natural-gas volatility, according to a spokesman for INTL FCStone.
For example, Evan Torrie, a California-based software engineer, allegedly put $250,000 with the firm in 2016 following a derivatives pitch from Cordier, the Journal notes. Torrie, however, worried about about the strength of the stock bull market and was looking to invest outside of equities.
Torrie initially received double-digit gains on his investment from the start in July 2018, and decided to put more money in, but recently he allegedly went from holding about $470,000 invested with OptionSellers.com to being roughly $150,000 in debt, the Journal reports.
Torrie allegedly sent a query to OptionSellers.com asking, Have I lost all the money in my account, then?
OptionSellers.com reportedly responded with a terse Yes, according to the Journal.
The windfall at OptionSellers.com is just part of a bigger bleak picture for the commodities hedge fund industry, with one of the last huge oil hedge funds taking on enormous losses this year due to the turmoil in energy prices.
OptionsSellers.com recently delivered a statement to clients which explains their turmoil:
Your account was caught in an extraordinary bout of volatility in the energy markets. In particular, natural gas prices experienced a parabolic move over the past 3 trading sessions. We had a short call position here that was on the wrong side of this. The magnitude of this move was so fast and intense that it overwhelmed all risk measures in place. It was like nothing we’ve ever seen.
Finally, it is important to not that, as of the date of this article, there has not been a finding of liability as to the complaints mentioned in this article, unless otherwise indicated.
The Goldman Scarlato & Penny PC law firm represents investors who lose money as a result of investment-related fraud or misconduct and are currently investigating OptionSellers.com‘s alleged commodities fraud scheme. The firm takes most cases of this type on a contingency fee basis and advance the case costs, and only gets paid for their fees and costs out of money recovered for clients. Attorney Alan Rosca, a securities lawyer and adjunct professor of securities regulation, and has represented thousands of victimized investors across the country and around the world in cases ranging from arbitrations to class actions.
Investors who believe they lost money as a result of OptionSellers.com‘s alleged commodities fraud scheme may contact attorney Alan Rosca for a free no-obligation evaluation of their recovery options, at 888-998-0530, via email at email@example.com, or through the contact form on this webpage.