Page 51 - Money - November 2018

BIG BETS

moment—had succeeded in remember, what happens at American investors have an id,
attracting attention. “THIS is why Wallstreetbets might sound a and that id needs to find an outlet.
I sub[scribe] to /r/wallstreetbets,” lot like day trading, particularly The forum was founded in 2012 by
wrote one user. “Yeah I’m sick of the feverish churning in tech Jaime Rogozinski, an entrepre-
the ‘I just lost half of my $133 stocks that became a fad in the neur living in Mexico, who wanted
Robinhood account’” posts, wrote waning days of the late-1990s a place where sophisticated
another. “Glad to see some actual bull market. investors could swap tips about
plays.” It all ended badly in the high-risk, high-reward short-term
Now that Cao’s bets had indeed dotcom bust. Since then investors trading strategies. “All the talk
gone bad—quickly burning have seemed to get a lot savvier. was about long-term investing and
through what the average U.S. Index funds, once a niche product index funds,” Rogozinski tells
worker earns in about three favored by financial professionals, MONEY. “Whenever I would go on
years—he had to give the crowd have steadily gained popularity Reddit and post a comment or
the spectacle it came for. He over the past two decades, question, I would get berated for
uploaded a new screenshot enabling individuals to own a not being a good investor.”
displaying his losses. broad swath of the market. Rogozinski, who is “not a huge
“Post[s] results like a man,” Meanwhile, the spread of the fan of the memes,” insists that he
responded one. “Mad respect,” Internet meant that detailed created Wallstreetbets as a
added another. investment advice, once available serious forum for learning. But
“I would have preferred to only in the pages of the Wall Street whatever his intention, the site
have not lost ~$185k in a day,” Journal or the office of a financial soon attracted an unruly mix of
Cao admitted. advisor, was everywhere and free. trolls and pranksters, including,
Believe it or not (and maybe In the past few years, this kind notoriously, Martin Shkreli. The
you shouldn’t, at least not all of it), of investing advice has seemed former hedge fund manager, who
this is just your typical day on the ascendant. Wall Street firms once is now serving a seven-year
Internet’s craziest finance forum. synonymous with trading or prison sentence for securities
Wallstreetbets, a message board, picking stocks tout their index fraud, once hosted a question-
or subreddit, on the popular news funds. So-called robo-advisors, and-answer session on the
and social site Reddit, has become which promise to manage money subreddit and was made a
a home for investors who want to for a small fraction of what a WSB moderator.
make extremely risky bets on the human professional costs, have Shkreli continues to be one of
stock market. attracted billions. Last year, the site’s favorite topics, along
There are now roughly as Richard Thaler, who helped design with Tesla founder Elon Musk,
many Wallstreetbets members set-it-and-forget-it 401(k) options known as “Papa Elon.” The pair
as there are Bloomberg terminal that improved retirement accounts are regularly mocked (or cele-
subscribers—over 300,000. But for millions, won the Nobel Prize. brated, the line isn’t always clear)
“WSB,” as the forum is known to So how does Wallstreetbets fit with memes and other jokes.
its members, is more than just a in? The answer may simply be that But WSB is best known as a
place for traders to swap tips. It
is a fusion of memes, bragging,
bullying, hoodwinking, and the -* =39 ,%:) 132)= =39Ş6)
exuberant overconfidence of
463&%&0= 30( )239+,
(mostly) young men.

REVENGE OF THE DAY TRADERS 83 92()678%2( 8,)
Of course, investing isn’t supposed '327)59)2')7 š
to be like this, at least not any-
more. To anyone old enough to —Jaime Rogozinski, founder of Wallstreetbets

NO VEMBER 2 018 MONE Y. C O M