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- A member of the Reddit page WallStreetBets grew $766 into $107,758 in two late-September trades, Bloomberg reported Thursday.
- Eddie Choi first purchased put options for Roku stock, profiting $49,787 when the streaming provider’s shares tanked more than 19% on September 20.
- The trader then used his profits to buy put options for the SPDR S&P 500 ETF — or SPY — an exchange-traded fund that tracks the benchmark’s performance. When its price tumbled on September 24, Choi’s investment surged to $107,758.
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Reddit has pages for nearly every interest, from oddly satisfying videos to Spongebob-themed meme pages.
One corner of the site — somewhat conservatively named WallStreetBets — hosts stock-market fanatics obsessed with rolling the dice on high-risk “YOLO” trades. Those who lose tens-of-thousands of dollars seem to brag just as boisterously as those who land massive gains, lending credence to the sub-Reddit’s tagline: “Like 4chan found a Bloomberg terminal.”
Eddie Choi is a lucky member of the latter group, turning $766 into $107,758 over the span of just two options trades, Bloomberg reported Thursday. The forum member said he learned how to trade options contracts on WallStreetBets, and became an overnight celebrity amongst its 600,000 members after posting his 13,967% gain.
“I’m naturally a risk-loving person. When I see these people making a lot and losing a lot of money, it caught my attention,” Choi told Bloomberg.
For the first half of his two-trade achievement, the trader purchased short-term put options for Roku stock — assets that capitalize on volatility and hinge on the underlying stock falling below a certain level, before a specific date.
When shares of the streaming provider fell 19% on September 20, Choi’s $766 worth of options was suddenly worth $50,553.
But the trader didn’t stop there. Choi then used his new capital to buy put options on the SPDR S&P 500 exchange-traded fund (SPY), a popular gamble among WallStreetBets members. When the ETF fell more than 1% on September 24, his options set to expire the next day more than doubled to $107,758.
Choi’s gains were fueled by the natural risk associated with options trading, and that the contracts he held were set to expire soon after he bought them.
For every get-rich-quick story on the forum, an unfortunate member posts a screenshot showing a hefty investment cratering overnight. Yet Choi’s luck hasn’t turned him away from the website or the risky trades.
“I don’t really want to stop trading options and reading WallStreetBets because it’s entertaining and funny,” he said.
“But I didn’t want to be infamous on the forum for losing all my gains.”
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