Rich Guys Who Lost Big Trading

Epic Losses by Wealthy Non-Traders

So over time, I’ve seen a few stories of rich dudes who weren’t traders per se but decided to play the leveraged product game and lost big time…

Let’s get right into it with a big loss.

#1 Mike Ashley – Retail entrepreneur and previous owner of Newcastle Football Club

Loss: £200 million
Market: UK Bank shares
Vehicle: Spread Bet

  • He went long on HBOS shares (UK bank) during the financial crisis at around 600p.
  • Over the subsequent months, the price fell to under 100p.
  • Ashley had to liquidate his positions and swallow his £200m loss.
  • At one point he was long £800k per point… Yes £800,000 per penny move in the stock.

I published a video on this topic 4 years ago…


#2 Robert Tchenguiz – Financier and property mogul

Loss: £40 million (estimated)
Market: First Group – A UK railway operator
Vehicle: Spread Bet

  • He positioned long in UK transport company First Group at around 100p.
  • His plan was to acquire enough to force change in the company, specifically splitting the US business from its UK arm.
  • During the pandemic though shares fell to 28p leaving Tchenguiz nursing some heavy losses.
  • Without enough margin to cover his positions, spread betting firms IG, CMC and Intertrader closed the positions and called in the debt.

(That’s the first group chart.)

He recently fought a legal battle with all the spread betting firms involved, protesting that he should have been classed as a retail client and enjoyed the protections that come with that classification.

He lost.

More here if you’re interested.


#3 Robert Day – Businessman

Loss: £1.8 million in one day
Market: Crude Oil and Forex
Vehicle: CFD

Robert Day opened an account with FXCM in January 2020 and on the 20th of April 2020 managed to lose £1.8m trading crude.

If you know about crude, then that day will stick in your mind…It’s the day oil went negative. (Remember my email about the Essex boys trading this and clearing up to the tune of $700m??)

I can only imagine Day was averaging down more and more until he ran out of margin and got liquidated…

Ouch.

He tried taking FXCM to court to claim £3.75m

You guessed it.

He lost.

What’s the common theme here? (Apart from losing in court…)

Risk management…

The market will let you play at any stakes table, yet the game is the same.

Come with a £500 bankroll or a £50 million the rules are identical.

Keep that risk managed!