Gold Candy

In 2007, I was a trader on the Chicago Mercantile Exchange. I loved the job. I loved waking up in the morning and catching the train into the Loop, as well as the hustle and bustle of downtown Chicago and the frenetic paces of the CME trading floor. I had been a floor trader for 20 years, so I had seen my share of the market’s ups and downs.

However, in 2007, something was different. All the indexes: the NASDAQ, the NYSE, the DOW were at highs. The housing market was booming, overseas markets were also having breakouts. The bond market was frothy. I said to myself, things were too good. After the 87 Crash and the Tech Bubble of 2000, I learned that all good things must come to an end.

So in the summer of 2007, I began to hedge my bets and short the market. To hedge, I began to pour into a gold position. By September, 60% of my portfolio was in gold, but that wasn’t enough. I could see gold prices were beginning to rise as the credit markets began to show signs of deterioration. I needed more gold, so I sold all of my stock and forex positions and went 100% invested in gold, but that still wasn’t enough.

As real estate began to crack, I had to find more gold. I bought physical gold bars, but I needed more. Then I had an epiphany – Gold Candy! I could corner the market on Gold Candy! By December 2007, I was buying thousands of options on Gold Candy, puts on Butterscotch Buttons, calls on Gold Candy Pearls. I went long on some Gold Sixlets as well as an ETF that was the largest investor in Butterscotch Candy Sticks.

As we all can remember, 2008 was a calamity. Washington was dysfunctional, the market crashed and the housing bubble burst. I rode the bearish wave and came out ahead by 296% with my gold positions, and none were more profitable than my speculation into Gold Candy. The market couldn’t get enough of it. My Gold Candy positions doubled and then tripled over night. If I hadn’t eaten all my stockpile of Gold Foil Hershey Kisses, I would have made enough to retire on, but they were just too good to resist and to this day I have no regrets. I still love my job as a trader.