Lenny Dykstra likes his options
Lenny Dykstra, the New York Mets and Philadelphia Phillies legend who got 1,298 base hits during his career, loves options.
Speaking at a feel-good event in New York featuring a group of former sports pros to discuss how sports informed their approach to business, Dykstra, who counts television stock picker Jim Cramer among his admirers for his investing prowess, likens pursuing a buy and hold strategy for stocks to “being hit with an idiot stick.” Options, on the other hand, spare you from margin calls, he explained before launching into the finer points of calls, puts, and straddles.
Dykstra’s advice didn’t end there. When a star-struck member of the audience at the Thomson Reuters newsmaker event asked about the value of financial advisors, Dykstra animatedly dismissed them as “Wally Wall Streets.”
That provided the only moment of tension in what was otherwise a towel-snapping hugfest between the graying jocks. TD Ameritrade’s outgoing chief executive Joe Moglia, who coached college football for 16 years before starting his business career, quickly rushed to the defense of his profession. After all, TD Ameritrade’s game plan is to ramp up financial advice and management…so its bottom line depends less on trade commissions.
“It’s not that complicated, but investors underestimate their sophistication,” Moglia told his fellow panelists, which also included New York Ranger Rod Gilbert and Carl Banks of the New York Giants. “We only exist to help clients achieve financial goals.”
And with that, the old lions resumed imparting nuggets of their business acumen to the audience, such as “You’ve got to be dedicated,” (Moglia), “Get dirt on the umpire” (Dykstra), “I’m a case study in niche marketing” (Banks) and “The restaurant business is the hardest.” (Gilbert)
The Last Supper
Last night, the Philadelphia Stock Exchange’s board members met for one final, extravagant time before the exchange, the nation’s oldest, gets absorbed by Nasdaq-OMX sometime in June. Philadelphia’s financial elite was gathered at City Tavern, a restaurant in old Philadelphia near the spot where the exchange first met, and staffed by waiters in period dress. There was a harp player and a carvery to entertain and feed le tout financial Philadelphia, and a few members of the media, including Reuters.
Though the deal means the Philadelphia exchange will now be taking orders from a New York-based exchange, there was much revelry and merriment. PHLX, now the third largest equities options market in the United States, after the Chicago Board of Options Exchange and the International Securities Exchange, was once moribund. But under chairman Sandy Frucher’s tenure, the exchange staged a turnaroud and was able to fetch the much celebration-worthy price of $650 million from Nasdaq last year, more than ten times what Nasdaq paid for the Boston Stock Exchange, once larger than Philadelphia’s, last fall. Even the mayor of Philadelphia, Michael Nutter, who in 1983 was an intern at the PHLX, turned out to pay homage to Frucher and the PHLX leadership, putting on a game face, even if it meant Philadelphia was losing another of its institutions. He tried to put a positive spin on the turn of events, saying he would welcome Nasdaq-Philadelphia, as if it were a merger of two equals, even though Nasdaq has been mum on any renaming or rebranding plans.
When asked what he would do to make Philadelphia a more prominent financial center, he simply said the city has approached venture capital firms in New Jersey to consider opening satellite offices for their Pennsylvania commuters. And then he again called the new exchange “Nasdaq-Philadelphia”.
“That’s what I’ll call it,” he said.
E*Trade execs lose jet, pad privileges
E*Trade’s belt-tightening after hitting turbulence last fall has also included ending the leases on its corporate apartments in New York and DC, forcing its executives to slum it when they travel. When new CEO, Don Layton, told an investor call after the discount brokerage announced earnings on Thursday, “E*Trade will be a smaller, simpler company,” he wasn’t kidding.
Now the executives will have to fly commercial and deal with removing their shoes at security, shampoo bottles from their carry-on baggage, snarky flight attendants and cancellations, just like the rest of us.
Private use of the jet was a perk given to E*Trade execs for years. The company’s former CEO Mitch Caplan, who was at the helm of the company as it built the mortgage portfolio that nearly felled it, racked up $132,859 worth of free personal travel on the plane last year, while departing COO Jarrett Lilien’s private travel cost the company $63,908.
In a regulatory filing, the company said it had a corporate jet to maximize the productivity of the execs and reduce the risk they’d accidentally reveal company secrets on a commercial flight. Let’s hope Layton doesn’t have to sit next to a noisy baby or busybody on his next business flight or stay at a budget hotel when he gets to his destination.
True Dan, but this company is crap, from the inside. They are a 90s dot.com trading company that used mortgages to keep from dying out. Damn E*Trade, either get taken over or close up shop, but end this!
