Historical Behavior

This trader has exhibited typical "retail trap" behavior during the 2024 BBBY incident—BBBY, a retail stock on the brink of bankruptcy, was pushed up by retail investors in 2023 due to the "meme stock" concept, but ultimately went to zero. At that time, he hoped BBBY would rise to $200 for an "early retirement," reflecting a misunderstanding of high-risk assets. Over the years, he continued to add funds (specific amounts undisclosed), but did not change his strategy, leading to losses expanding from $80,000 to $140,000.

Capital Flow

The flow of funds is clear: Robinhood and Webull, two major zero-commission platforms, are concentrated areas for retail options trading, with 2026 data showing that these two platforms account for over 60% of retail options trading volume in the U.S. Choosing short-term options (expiration < 2 weeks) instead of long-term options essentially exchanges "high time value decay" for "low premiums," but the win rate is extremely low. The implied volatility of RDDT options at 84.72% indicates that the market has priced in extreme volatility, and retail buying is akin to paying high "lottery fees" to market makers.

Analogy + Industry Position

Similar cases: During the 2021 AMC and GME meme stock craze, many retail investors bought deep out-of-the-money options at the peak, which ultimately went to zero. Before the 2022 LUNA crash, retail investors similarly concentrated on high-leverage bets on a "rebound." Such behavior is at the extreme tail of the "retail options market"—Robinhood's 2025 financial report shows that its users have an average loss rate of 74% in options trading, but this trader's loss rate of 99.84% is still rare.

Structural Judgment

This essentially represents a transfer of pricing power leading to wealth redistribution. The options market is fundamentally a "zero-sum game + negative-sum game" (considering fees and time value decay), and retail buying short-term out-of-the-money options is akin to paying a "probability tax" to market makers (like Goldman Sachs, JPMorgan, etc.). Market makers profit from time value through delta hedging and volatility arbitrage, while retail relies on the dual conditions of "correct direction + matching time window," resulting in a win rate naturally below 50%. This explains why the options market has a long-standing structural divergence of "retail continuous losses, institutions continuous profits."

ABAB News · Cognitive Laws

Time value is the most expensive hidden cost of options
Retail investors buy lottery tickets, institutions run casinos
The recoup mentality is more fatal than the loss itself