The new "big brother" has emerged - nicknamed "Captain Vulture," leading thousands in options trading, with a scale large enough to shake the US stock market

You may have never heard of the name David Chau, but in the Wall Street options trading circle, the title "Captain Condor" is well-known.

This 31-year-old top trader does not appear in the top-floor offices of Wall Street like traditional financial moguls; instead, he commands a trading army of over 1,000 people from his home in Nevada through a complex options strategy.

His trading scale is so large that it can sometimes shake the entire U.S. stock market.

From Mysterious Big Player to "Captain Condor"

"Captain Condor" first entered the public eye last year. At that time, some people noticed the emergence of multi-million dollar options orders linked to the S&P 500 index in the market. Soon, these massive trades, capable of shaking the market, began to be dubbed the "Condor Army," a group of options traders determined to uncover the true identity of the "Captain."

Before long, David Chau came forward to "certify" that "Captain Condor" is indeed him.

Chau describes himself as "socially anxious" and enjoys trading from home, but he is not a lone wolf.

He runs an online trading community with over 1,000 members. When he shares his index options trades in the community, many followers will follow suit, amplifying his trading influence. Sometimes, their bets on the volatility of the S&P 500 index are large enough to shake the entire stock market, with some trades exceeding 30,000 contracts.

"When the number of contracts exceeds 10,000, it starts to become a real big deal," said Cem Karsan, founder of Chicago's Kai Volatility Advisors. "If it reaches 20,000, that's the number one big deal in the market."

As a day trader, Chau's signature trading method is to buy or sell call options above the trading price of the underlying asset while buying or selling put options below the trading price of the underlying asset. Depending on the betting method, this strategy profits when the S&P 500 index remains within a specific trading range or exceeds that range.

When these trades are displayed on a chart, the numbers protrude from both sides, resembling bird wings, which is why this strategy is also known as the "Iron Condor" strategy. The strategy gains positive returns when the stock price is above the high breakeven point or below the low breakeven point.

"The market is a battlefield, right? You have to have strong willpower like a frontline soldier," Chau said in a media interview. "I just like to stay at home and do my own thing." Chau's trading style is highly adventurous. When he incurs a loss on one bet, the next day he places another bet, with the contract size approximately double that of the previous one, and community members follow his strategy. This practice is known in the gambling world as the Martingale strategy, aimed at giving gamblers a chance to recover losses and make a profit when their bets eventually succeed.

"My goal is not to avoid losses, but to ensure that losses do not destroy the entire account of the investor," Chau explained. "Traders who are unwilling to take this risk should choose to opt out."

Thousand-Person Trading Legion

Chau's identity is no longer a secret to those who pay to participate in his InsideOptions options training program.

Currently, over 1,000 people have joined the program's Slack channel, where they learn Chau's trading philosophy. Chau occasionally shares some options trading courses for free on YouTube. It is said that the program has helped many investors achieve substantial returns on their investments.

The InsideOptions program has certain requirements for members' trading capital. In a post Chau shared on Instagram, he wrote:

If you have $26,000 and want to make that money work for you, I can help you trade like the top 1% of traders in the world, using a proven strategy, even if you have little to no experience!

As for the source of Chau's own trading capital, he mentioned in an interview that he trades with his own funds and those of the alternative fund he founded, SPX Program Fund LP.

The fund was established in 2023 and aims to provide effective active trading strategies for sophisticated investors. Currently, the SPX Program has over 30 investors, many of whom are also members of the InsideOptions program. Chau did not disclose the fund's asset size but stated that it "exceeds seven figures."

How Will the New Generation of Internet Celebrity Traders End?

The attention of American retail investors on star traders has lasted for a century, from "Boy Plunger" Jesse Livermore to the "Roaring Kitty" Keith Gill during the MeMe craze, the stories of these traders have always been in the spotlight. Their adventurous experiences, huge profits, and even devastating losses have been recounted as inspirational legends or cautionary tales, becoming classic examples in the investment world The rise of "Captain Vulture" coincided with the astonishing growth of the U.S. options market. Since the end of 2020, retail options trading volume has surged, as the pandemic lockdowns and government stimulus plans triggered a market rebound, rekindling Americans' interest in day trading.

According to data from the Options Clearing Corporation (OCC), the daily trading volume of options contracts reached 49 million in 2024, up from 19 million in 2019. Since then, trading volume has set records every year. As the market has expanded, the share of retail investors has also increased: data shows that by the end of last year, they accounted for 29% of all options activity, up from 23% at the beginning of 2020.

Chau is undoubtedly a leader among these traders. However, not everyone believes the options market needs an American Captain-like figure.

This is because such strategies carry significant risks, according to Brent Kochuba, founder of the derivatives data company SpotGamma.

I think this will only end badly. If he knows what he’s doing, that’s great. But the scale is a bit crazy. Doubling down on every trade is just gambling.

Kochuba has been tracking Chau and his community's trades, and he worries that if the scale of these bets becomes too large and their funding is insufficient, the strategy could collapse.

Amid the controversies surrounding others, Chau's influence continues to grow, with his Instagram following surpassing 66,000. The SPX Program is currently trading live in an incubator fund and is expected to launch a private placement in the second half of 2024.

But Chau seems to be aware of the risks as well, stating that he is considering no longer accepting new members.

I have always been worried about the impending doom. Nothing good lasts forever