Karen SuperTrader final scam

The one whom people though as the best options trader in the world, was finally accused by the FED with different charges.

Although I have to say that being accused by the SEC is nothing that should make us believe that the person is guilty, however in cases like these we can trust the organism with quite certainty. Especially when we know the business has many flaws.

Let us talk about Karen SuperTrader again, the hope of so many traders.

I talked about her already in my Spanish blog when I gave my opinion that her strategy was not very sound. The kind of strategy that works well when the conditions favour it for a while.

The strategy was simple: you get used to the S&P to rise substantially time after time and start selling sell options for the medium-term. In a bull market it is not difficult to make money like this.

The problem is when the trend changes or when there is even a significant correction.

Nonetheless even if the market goes well you still need to have some sort of system and discipline since it does not take much for you to start having losses when the market deviates a bit.

Well, it seems that Karen did not need a bear market to start having significant losses. It could be that this woman started to sell more calls as well, I do not know for sure.

What seems sure is that Karen hid her losses to the public for quite a long time using accountant tricks.

It seems that she was actually having losses and needed new deposits to cover her previous customers.

This is something very typical in these kinds of arrangements.

Ponzi anyone?

Another accusation was for the fact that she was charging for supposed profits when in fact she was having terrible losses.

Remember that this system supposedly was able to win in all conditions with its magical trading formulas which in the end resulted in nothing more than good marketing selling techniques.

Unfortunately, a significant amount of trading systems that are advertised in the internet follow the same parameters, with differences only in the surface not in essence.