The Market Monsters’ Momentum Shift

Published on
April 9th, 2019
Duration
61 minutes


The Market Monsters’ Momentum Shift

The Interview ·
Featuring Peter and Jon Najarian

Published on: April 9th, 2019 • Duration: 61 minutes

Peter and Jon Najarian, co-founders of Investitute, are the best known faces for options trading. In this wide-ranging interview with Real Vision veteran Tony Greer, the brothers explain not only why they left football for finance, but why they eventually left the trading floor entirely. The finance industry has gone through a technological revolution via algorithmic trading, passive investing, and AI. The brothers relive the experience of that revolution and outline how to take advantage of its future. Through all the change, they still see plenty of opportunity for young entrants in the business. Filmed in New York on March 14, 2019.

Comments

Transcript

  • JS
    Justin S.
    15 April 2019 @ 14:30
    Great job to Tony! Really great connection and very sincere enthusiasm for the guests.
  • JF
    Joseph F.
    15 April 2019 @ 05:18
    Ego Management! How true. The best book I ever read on this phenomenon is, "The Ending of Time", by Jiddu Krishnumurti and David Bohm. Must read for any trader imho.
  • TB
    Theron B.
    12 April 2019 @ 21:40
    Most of this interview is a just a reflection on recent market history and personal experiences of a couple of entertaining gentlemen, but the trading advice at 49 is excellent. The risk management advice in this segment reminds me of the advisories in Market Wizards I &II, with would have saved me from a costly trading decision in the past few months.
  • WB
    William B.
    12 April 2019 @ 03:28
    Great interview. wonderful they know each other which will lead to fun segments, BUT it still sounds to me like these guys (all 3) want ‘put protection ‘ from an uptick rule, trading halts, or FED ‘put’ so they can continue using leverage as they wish w/o lots of 6 sigma fear. Free markets would clear out HFT firms that over leverage (over time of course) and teach people that passive investing just provides the kindling the HFTs and algos feed on.
    • DS
      David S.
      15 April 2019 @ 15:59
      one of them is blaming algos for big swings in the market yet the market on day to day volatility measure has been as low as it has ever been even during the 2018 sell off day to day volatility was below average for the typical year.
  • WC
    William C.
    12 April 2019 @ 02:06
    these guys are great. Very enjoyable.
  • RG
    Rick G.
    11 April 2019 @ 11:03
    total garbage, what are you guys thinking putting these clowns on your site ?
  • mb
    michael b.
    11 April 2019 @ 10:08
    I'm surprised that Tony didn't dig a little deeper regarding the 9/11 airlines trade.
  • LT
    Lucas T.
    10 April 2019 @ 23:34
    Loved the interview, however I would amend one thing. The whole conception that MMs were there to step in with a bid, and make a market, when no one else was...was pretty roundly shown to be false. MMs like to say this old tired line to give their image some shine, but during most crashes they are selling into the hole with everyone else. MMs are not running a charity. Computers do it tighter, faster, and better. #unpopularopinion
  • PG
    Philippe G.
    10 April 2019 @ 13:47
    Love it. Always great to see personalities like these guys!!
  • GR
    George R.
    10 April 2019 @ 12:22
    I've never seen the 9/11 airline puts theory ever proved. Can someone print time and sales from Bloomberg from that week in history so we know once and for all please???
    • GP
      Graham P.
      10 April 2019 @ 15:19
      We had US and UK regulators into our offices combing over trade histories as we (innocently) had short positions in Airlines at the time through short stock and put positions. They were doing checks on everyone but they obviously felt there had been large, suspicious trades that they wanted to trace. I was pretty convinced at the time that the story/rumour was true.
    • AM
      Andrew M.
      10 April 2019 @ 21:17
      There is a fair bit of stuff if you look, on both sides. http://www.scientistsfor911truth.info/docs/Poteshman_Puts.pdf - specifically references Najarians. Lars Schall has been the main academic looking at it: https://www.larsschall.com/2012/03/20/insider-trading-911-the-facts-laid-bare/. he's written various academic articles on the put options. there are some others too. rebuttals: http://www.911myths.com/html/put_options.html http://www.911myths.com/html/volume_spikes.html
    • RP
      Raoul P. | Founder
      11 April 2019 @ 00:17
      I too was short airlines via sector swaps then too. It was just based on global slowdown bets in the portfolio. I was short airlines, hotels and retail and massively long Eurodollar futures and gold. Uncomfortably, it was the most profitable day of my investing career. I close it all out as markets opened, as did anyone with a conscience. But the massive option trades in airlines did stand out as odd. Graham P - I presume you are the Graham P I know well?
  • PB
    Pieter B.
    10 April 2019 @ 09:57
    Absolutely fantastic! Thanks a lot!
  • DS
    David S.
    10 April 2019 @ 08:00
    The Najarian brothers are great and the Fed and the trade war are important. They missed, however, the major market mover of 2019 - declining earnings. Do you think that the Samsung earnings projections of down 60% are a one off? Amazon is going into regular groceries stores to disrupt the profits even more. In the US margins are being squeezed by competitive pricing, wage increases and the strong dollar. There will be profitable companies which the Najarian brothers will find, but everyone should be very careful with volatility from earnings declines. Cash will be king in 2019 as we try to buy bargains resulting from volatility like Christmas Eve or even lower. The strong rebound is close to even. Do not expect to be so lucky again. DLS
  • JH
    Johannes H.
    10 April 2019 @ 06:55
    This video seems to be listed with length 01.55 on the front page, not sure why. Otherwise great!
    • AK
      Arthur K.
      10 April 2019 @ 18:11
      Yeah, they have that error on a the longer videos, not just this one.
  • TM
    Tom M.
    10 April 2019 @ 00:58
    Algorithmic trading and investing are going to murder the markets one of these days.
  • SB
    Sean B.
    9 April 2019 @ 23:31
    Well done Tony. I think RV does a great job in pulling out people’s true talent that is often talked over, steered, or dramatized in other other media outlets. Happy to learn more about the Najarian Brothers and their accomplishments.
    • TG
      Tony G. | Contributor
      10 April 2019 @ 11:10
      Thank you Sean B.
  • AA
    ALBERTO A.
    9 April 2019 @ 20:53
    These guys made it as floor traders and kudos to them. But I can't believe that nowadays RV included these two CNBC collaborators. I say this with all respect. I'm an option trader and bought their book "follow the smart money" to see if there was an insight on discovering the "unusual option activity". It was a complete disappointment and almost laughable to the degree of plagiarism. The book was a copy paste of "options" theory and their method or system did not appeared anywhere in the book. I went even further just to see if this was a scam and bought one of their courses (as they are refundable) and it was even worse. Judge for yourself but RV has impressed me as a different level and thinking of finance and their guests should be at a higher level and bring these insights. They might have good intentions but to me their system is a marketing gimmick. In any case...they are famous and with lots of dough...
    • CT
      Chris T.
      10 April 2019 @ 16:09
      Respectfully, you couldn't be more wrong. Their latest book, "Follow the Smart Money" actually does reveal what they look for in the options markets and lays out clearly their method, just short of revealing the proprietary factors that go into their algo. And their education is top rate, covering everything from Option Theory to Advanced Options Strategies and Applications. Unfortunate you did not give yourself a chance to go through the entire curriculum. I have yet to find a more comprehensive options curriculum available at a high level.
    • AA
      ALBERTO A.
      11 April 2019 @ 02:48
      Good luck Chris T. If you find their method and process helpful and you can make money in a consistent basis then I’m glad it is helping you. But also respectfully, their framework is so generic and lacks so much math and probabilities logic that I was completely stunned. Believe me, I read their book and went through their course and could smell it from the beginning. In any case, good luck to them. I mean no harm as they seem to be nice guys but I am expressing my honest opinion as an options trader with lots of scars on my back. Consistent frameworks need strong logic to have a real edge or WS will eat your lunch. At least I need the math behind it. I dont believe you need to buy a proprietary tool to be succesful as must gurus try to sell you. That’s why I love RV so much...because it is about understanding people’s frame of mind and high intellectual capability behind their thinking. In any case, good luck $$
  • RA
    Robert A.
    9 April 2019 @ 20:38
    Great job Tony and one of your best interviews yet, IMO. A great mix between the historical, some broad timeless trading chestnuts and a here and now opinion regarding the Fed and the Trade Deal dynamics for the next year. Nice balance and some good chemistry between the three of you. Nice work in both getting the N brothers and in keeping them focused on what we RVer’s would want out of the interview. Nice work RV.
    • TG
      Tony G. | Contributor
      10 April 2019 @ 11:11
      Thank you Robert.
  • KC
    Kenneth C.
    9 April 2019 @ 20:04
    Two guys who have managed to continue to find success. Good interview, definitely a good background listen. And I don't really know who they are as I don't watch CNBC though I've seen them on commercials.
  • DF
    Dave F. | Contributor
    9 April 2019 @ 19:13
    This is a gem.....truly one of my favorite spots on RealVision
  • TR
    Thomas R.
    9 April 2019 @ 18:56
    Great Job by Real Vision. Getting the Najarian brothers demonstrates the clear objective on getting all points of view from credible sources. Agree or disagree with these guys - they are clearly accomplished, clearly entrepreneurial, and are credible. Before finding RV, I was a CNBC and Bloomberg watcher. I did and still like these guys - even if I don't agree with everything they may say. They are mainstream media and they play by those rules and play those roles quite well. It will be fascinating to see, in our life times and perhaps in the not too distant future, when Real Vision (in the age of where Netflix and Pod Casts, U-Tube, Blogs, Instagram, etc displace Networks ) becomes the new standard in the new main stream - and then, what does that look like?
  • WB
    Wes B.
    9 April 2019 @ 17:15
    As a former market maker at the CBOE, I appreciated this. I held on to my market making business until 2017 and there were actually some fantastic years after these guys sold theirs (2007-8 and 2011 were phenomenal), but in the end their take was spot on. Electronic trading eventually killed the market making firms who weren't able to commit 10's of millions to system development. The continued success of the Najarians I find surprising and is to their credit. They have pulled several rabbits out of their hats and are no longer just some dumb guys from the floor (like me).
  • JS
    Jason S.
    9 April 2019 @ 16:43
    Awesome interview - lots of great little nuggets hidden everywhere.
  • CB
    Conor B.
    9 April 2019 @ 14:55
    Little known fact: Charlie Munger always does his best thinking while wearing a Kangol...
  • CS
    Charles S.
    9 April 2019 @ 14:36
    32:50... as a young person I wish they would've explored some of these opportunities for young professionals. If anyone has any thoughts on this subject I would love to hear it. Thanks.
    • CS
      Charles S.
      9 April 2019 @ 14:39
      Edit: 32:50 remaining in the video
    • FB
      Frank B.
      9 April 2019 @ 19:15
      from what I heard, they steered towards opportunities in PE and VC.
    • TG
      Tony G. | Contributor
      10 April 2019 @ 11:11
      That's a good lead Charles...I'll dig in to this.
  • Nv
    Nick v.
    9 April 2019 @ 13:27
    Great convo. Incorrect on US-China dynamic though. Chinese equities up a lot more than US equities YTD
  • GP
    Graham P.
    9 April 2019 @ 13:25
    Nice guys. They've done very well and good luck to them. Some nice nostalgia but little real insight for the here and now.
  • MM
    Michael M.
    9 April 2019 @ 10:49
    Really silly objections below. I'm finding this fascinating and these guys are very likeable
  • DH
    Damian H. | Founder
    9 April 2019 @ 10:10
    The fact that they appear on CNBC is irrelevant to us. We like to think we can find value and learning from their experiences that CNBC can't...
    • MN
      Maverick N.
      9 April 2019 @ 16:42
      Was that the founding vision? Or has that evolved?
    • TH
      Truman H.
      9 April 2019 @ 20:26
      Fair enough; one of the reasons I paid up for RV is to get AWAY from CNBC's mindless bullishness. Alan Abelson used to say that the "B" in CNBC stood for "bullish."
    • DS
      David S.
      10 April 2019 @ 02:55
      Many of the financial experts on RVTV have been on CNBC for short five-minute segments. How many financial greats do you think there are? On CNBC they give quick thoughts, on RVTV they are given the time to help us understand their thinking. To exclude interviews like this would be inappropriate. Let's see them back again. DLS
  • PU
    Peter U.
    9 April 2019 @ 09:35
    Can't even force my self to watch this. I'm out.
    • PU
      Peter U.
      9 April 2019 @ 09:35
      myself
  • PU
    Peter U.
    9 April 2019 @ 09:33
    Nobody, . . . nobody from CNBC should be on Real Vision. Nothing against these guys, but Real Vision is the antithesis of what CNBC stands for! Shame Shame Shame.
    • MK
      Michael K.
      9 April 2019 @ 10:44
      I feel the same way at first. Such a source of misinformation. Yet, one has to consider, if real vision has thoughtfully curated for the client base thus far, then if I have a part of commute to give it a brief audit, I will. "There is a principle which is a bar against all information, which is proof against all arguments, and which cannot fail to keep a man in everlasting ignorance—that principle is contempt prior to investigation."
    • DS
      David S.
      10 April 2019 @ 16:31
      Many of the financial experts on RVTV have been on CNBC for short five-minute segments. How many financial greats do you think there are? On CNBC they give quick thoughts, on RVTV they are given the time to help us understand their thinking. To exclude interviews like this would be inappropriate. Let's see them back again. DLS