You know that thing about how if something sounds too good to be true, it usually is? Well, yeah, that’s totally true.
Take, for instance, the fantastical tale of Mohammed Islam, the “genius” New York high school investor who reportedly made $72 million while playing the stock market with his investor pals at Stuyvesant High School. Amazing, right? New York magazine did a glowing profile of him and everything in its “Reasons to Love New York” section.
Well, not long after that story blew up, financial experts said, “um, no.”
“Based on his press clippings, 17-year-old high school senior Mohammed “Mo” Islam has already achieved a level of market mastery beyond most investor’s wildest dreams,” wrote Yahoo! Finance on Monday morning.
“Assume Mo started investing with $1,000 when he was 10. To accumulate $72 million strictly through his trading acumen he would need to average over 500% annualized returns over the last 7 years,” the site wrote. “That means he would have had to double his money every one to two months for 7 years straight… to net 500% per year for 7 straight years Mo would have to be the greatest trader in history. Ever. By far. No such creature has ever existed in financial markets and it’s not for lack of trying.”
By the end of the day Monday, the whole thing unraveled. “EXCLUSIVE: New York Mag’s Boy Genius Investor Made It All Up,” read the headline from the New York Observer, which sat down with a disgraced Islam and pal Damir Tulemaganbetov to let the pair come clean.
The actual amount they made trading? Zero. Nada. Zilch. Surrounded by a team of four from the crisis management firm they’ve hired, Islam admitted that he made the whole thing up. A friend of Islam’s father who works at New York hooked the 17-year-old up with the reporter. In the piece, Islam appears to say that his returns are in the “eight figures,” but admitted to the Observer that he’s invested nothing and made nothing.
“So it’s a total fiction?” the Observer asked.
“Yes.” Well, he does run an investment club at Stuyvesant that does simulated trades, which, he said (after consulting with his crisis team) had returns that were “incredible.”
New York (kind of) stuck to its original story in an editor’s note, in which the writer said the $72 million was originally presented as a rumor. “However, Mohammed provided bank statements that showed he is worth eight figures, and he confirmed on the record that he’s worth eight figures.”
0 comments:
Post a Comment