This Magic Momentum

“I’m getting raped today,” says 24-year-old day trader Kirk Kazazian (University of Pennsylvania, ‘96) to no one in particular. All around him, at the Park Avenue offices of, row after row of young men sit transfixed by the flashing red and green numbers on their computer screens. Were it not for the fact that all are wearing baseball caps and jeans, this could be a trading floor anywhere, with its requisite stale air, gurgle of CNBC in the background, and testosterone-injected humor that comes with the absence of womenfolk. It’s here at Tradescape that a troupe of postgraduates with quick reflexes have parlayed the $50,000 minimum opening balance ($10,000 for home traders) into serious coin.

This past year, Kazazian earned $5,367,632.13 (net of commissions), inputting an average of three trades a minute; he started with a $22,000 stake only eighteen months ago. November was his best month ever – he made $1.2 million. Kazazian doesn’t bother researching the fundamentals: Take INCY, for instance. Today, Kazazian’s up $16,000 in the stock. It’s a biotech company, Kazazian offers tentatively. “I know its name – it’s just not coming to me right now.” On a typical day, all of Kazazian’s ins and outs constitute 0.05 percent of the volume on nasdaq. “Every day, I find another hot stock they’re mentioning on CNBC that goes up 200 percent in the day,” he says, laughing. Bad stocks are Intel and Cisco. “They don’t move in spurts,” says Kazazian. “And they have a lot of market-makers, so we can’t manipulate them as much.”

Living Dangerously Founded in April 1997 by 27-year-old Omar Sharif Amanat (Wharton, ‘95), Tradescape bought Momentum Securities last June; a month later, a day trader went berserk in its Atlanta offices, killing four Momentum employees, five day traders at another company, and his own family. “It was a real tragedy,” says Amanat. “But it’s not like the CEO was going around shooting people. Momentum’s management team has one of the best reputations in this sector.”

Just one month later, Tradescape received a $28 million infusion from the Japanese Internet holding company Softbank; long-term plans include an IPO. Kazazian, an investor in the firm (it has 17 offices nationally, 4 in Manhattan), is convinced that Tradescape has the best technology going – E*Trade’s thinking about licensing the software. “That’s all day-trading is about,” he says. “Having the best execution, the fastest speed.” Kazazian knows, however, that horsepower may not help his crew in a major correction. “If a lot of people are scared out of the market,” he says, “then that wouldn’t allow for these big moves in stocks anymore.” That would pain him – greatly. “I could still make, maybe, $10,000 or $20,000 a day,” he says. “But it just wouldn’t be as fun.” A bad day is when Kazazian manages to lose $100,000: “It’s happened a lot, actually.”

Moneymaking Mantra “I don’t like to think of this in terms of dollars. I think of it in a terms of a score or a number. That way, you don’t put pressure on yourself.”

Kazazian’s M.O. is simple: “Any stock not related to high tech or biotech is not a good play. And once a stock takes off and runs for like 5 or 6 points with no one selling, that’s where I’m selling it all, because a lot of times, that signals the top. Likewise, on the bottom, when its just drifting down, drifting down, you’ve really got to wait for that last flush – when the sellers come in, and they finally just emotionally dump everything. And you’re in there, buying at the bottom, buying 10,000, 20,000 shares. When it bounces up 2 points, that’s how you make money.”

Where He’s Headed In 2000 To the Ferrari dealership, where a $170,000 midnight-blue 360 Modena with his name on it is arriving in February.

This Magic Momentum