Firm ‘Wiped Out’

A well-known trading firm is apparently the first to acknowledge it was wiped out in Monday’s stock market rout. Niederhoffer Investments Inc. says it incorrectly bet U.S. stocks would rise when the market had its biggest point loss ever.

Niederhoffer had taken options on the Chicago Mercantile Exchange’s S&P 500 futures index and was unable to meet its obligations at the end of the day, the company said in a statement. The Dow Jones industrial average fell 554 points, or 7.2 percent, on Monday before roaring back the next day.

“Sadly, it would appear that if it had been possible to delay liquidating most of the funds’ accounts for one more day, a liquidation could have been avoided,” said the statement.