Churning and Chatting, Interview 1: Knish–The Consistent Grinder

First interview! I’ll spare you the preamble—jump in and get to know Knish, whose steady grind reminds me of John Turturro’s immortal character in Rounders.

Opening connection

I remember reading about Knish from Two Great Positions, where he was one of several “all-star” traders Victor boasted about having trained. When MBC accepted me to join their prop desk, I figured I’d meet Knish and hear him explain the so-called “Knish trade” himself. But when I first got there, I learned he’d already left, along with all the other traders in the book. It was quite the disappointing experience. 12 years later, he connected with me over DMs.

PETE: How’d you recognize my blog?

KNISH: A few paragraphs into Prop Trader Series, I knew you were talking about MBC. I’d actually found your blog a couple years earlier and suspected you were an alumnus, but I forgot to bookmark it. The whole series was a fun walk down memory lane. Some of the emotions you describe when trading in real time–it was almost eerie, like reading my own personal diary.

Getting started / 2006–2007

PETE: How’d you get into trading?

KNISH: I was a finance major in college, but I didn’t have any real interest in it. It was strictly a practicality major. What I was actually obsessed with was music and guitar. That started in my teens and continued into college, to the point where I could barely concentrate on schoolwork. Sophomore year, I had a serious conversation with my parents about dropping out to enroll in music school. It didn’t go so well.

That was pretty depressing. I started to feel I wasn’t a good enough musician to follow that dream. Then junior year, I took an Investing 101 class and thought, “This isn’t so bad.” Later on, I dabbled in a paper portfolio filled with trash stocks and started watching Cramer’s Mad Money show on CNBC. I wasn’t interested in fundamentals or long-term investing, but I took a liking to the strategic aspect of predicting the stock movement itself.

PETE: How did you end up joining your first prop firm?

KNISH: I had no interest in getting an analyst job. I wanted to be involved with stocks right away. Senior year, I found Stone Brothers and went to their Jersey City office for an interview. All the lights were off, all windows covered, CNBC was blasting, and I saw a guy in sweatpants sitting in front of four CRT monitors. It felt like a room full of degenerates that no sane person would want to join in on.

But I knew.

The interview was easy. Honestly, they were probably willing to hire anybody who showed an interest in the markets.

PETE: How did they train you?

KNISH: The office I traded at was right next to the NYSE, so as a naive college graduate, I felt a certain level of prestige. No deposit initially and commissions were $10 per 1000 shares. They put new trainees next to a senior trader. No formal training program—you just observed and asked questions. The guy I sat next to was really nice and had apparently been on a good winning streak–which stopped the first day I sat next to him. I was trying to learn, but in my head I was thinking, “This guy sucks!” I eventually became known as The Cooler because I’d stopped his streak. Fun office environment for sure–lots of jokes and ribbing, we’d all play Call of Duty when markets got slow. But they lacked the structure that newer traders needed.

PETE: Were you making any progress?

KNISH: I had no idea what I was doing. After a couple months of going nowhere, the manager pulled me aside and politely said, “Maybe this is not for you.” I was essentially fired, and I was devastated. Over the weekend, I convinced him to let me put up a $10k deposit of my own money, to give it another try. I read as many books as I could find and tried searching for strategies online, but information in 2006 was a wasteland. One thing to note–I at least got pretty good at following a plan and stopping out if necessary. It was always the wrong plan, but at least I followed it.

PETE: What were the good traders doing?

KNISH: Stone’s bread and butter was trading NYSE stocks and imbalances. Back then, specialists in certain names had tendencies that would tip off the best tape readers for the next move. There would be a tell on the tape, they’d buy a bunch of stock, then market-sell on the NYSE and get these outrageous fills.

They loved to trade the homebuilders, like KBH and LEN. Around that time, the NYSE was going hybrid. I distinctly remember watching CNBC and seeing the people involved in the hybrid rollout getting booed by specialists. NYSE stocks started trading more like Nasdaq stocks, which eroded those traders’ edges. I never made any money doing this, which was probably a blessing. If I started making money that way and then had to start all over again, I’d have quit.

PETE: How did you move on to your next firm — MBC Securities?

KNISH: Eventually that office closed, and a lot of the successful traders moved over to a firm called Mosaic. I wanted to tag along but when I told the manager of Mosaic I was just a rookie, he said, “Why don’t you join this firm next door called MBC Securities? They train their traders.” That was April 2007.

The MBC years / 2007–2010

PETE: How true was the book? Victor claimed you were profitable every day for 2 straight years. He called you the Joe DiMaggio of trading.

KNISH: I’d say almost all true, from what I remember. The qualification I’d make about the P&L and my streak is that Victor liked quoting gross profitability. We traded so actively that commissions made a meaningful difference to net. So there were days I’d be gross positive but net negative just by churning too many shares.

PETE: You were focused on a tape trade called the “Knish trade”–which you traded so much, they basically named the trade setup after you. Was your style really that simple?

KNISH: Pretty much. Find the big offer at the whole. Pay into the decrementing action and sell into the first move—that was my bread and butter for a long time, and it still works to an extent even now.

From how you described Clockwork early on, I traded very similarly to him. When you wrote about precise scalpers wanting control, then squirming when they have to let a stock wiggle, I recognized that feeling of anxiety. I just wanted in and out so I could cash the sure thing. I’d do it all day, I loved it.

They did push me to try to hold positions longer but I never understood the context behind what plays would have bigger moves and which wouldn’t. It was hard to distinguish that without experience. I’d always revert back to pure scalper mode.

PETE: What were the best days on the desk?

KNISH: There was the Friday when Bear Stearns was collapsing and it marked the beginning of the 2008 financial meltdown. We had never seen anything like that and it completely changed the way stocks moved, particularly the financials. Whole month got crazy from there on. I remember this day trading GS (Goldman Sachs) in September 2008. GS would make enormous moves down and back up, with one-minute candles moving six or seven points. What I remember most was how readable it felt–orders would cluster at key levels and then just burst fire in a way you could react to and someone like me could make pain free money.

The way you described FNMA reminded me of GS: you felt you could see when it was topping and when it was bottoming. I just wish I had the confidence levels to be more aggressive back then.

PETE: What about the worst days?

We never really got crushed due to MBC’s strict risk parameters at that time. Our max stop loss was around $1000 a day, give or take. The market did get harder after 2009 though.

PETE: What changed?

KNISH: The algorithms were getting much better and made the old tape patterns harder to read. Volatility died off in the financials. By mid-2010, morale was low and it wasn’t just because we made less. There were arguments between desk leadership and the senior traders over little things like communication and sharing ideas. In retrospect, these things are probably related. It’s easier to get along when everybody’s doing well.

PETE: When I arrived at MBC, the previous generation of consistently profitable traders had completely disappeared. What happened?

KNISH: Some traders already left to start their own thing like a hedge fund. Some wanted a better fee structure and moved to competitor firms. I had friends who were just tired of the constant head-butting with management. They negotiated for a better deal somewhere else and I followed them.

Looking back, I’m incredibly grateful for that era of trading. It gave me the foundation for everything that followed, along with some of the fondest memories of my early twenties. I wouldn’t be where I am today without it. The camaraderie is what I miss most.

Mosaic / 2010–2012

PETE: How were you doing in 2011?

KNISH: I remember the latter half of 2010 and most of 2011 being fairly uneventful, other than the U.S. credit downgrade in August 2011. We weren’t killing it, but the money saved on commissions mattered. We were living decently in Manhattan. Not popping bottles, but not living frugally either. I could definitely see that period being hard if you were just starting out.

PETE: What’s your best prop-desk story from this period?

KNISH: The Chevron (CVX) fat-finger mistake. I was in a subgroup that focused on trading imbalances. A rookie was supposed to sell 1,000 shares of CVX market-on-close, but he was selling 10,000 shares per click, he clicks away too much thinking his lot size was just 100, and somehow ended up short 90,000 into the close. The head of the group went pale white.

There was a discussion on how to exit afterhours, which didn’t seem possible without eating a big slip. Then one of the bigger traders said to hold it over the weekend and try to exit Monday at market. Of course, it was a long weekend, some Middle East political news hit the wire, crude oil spiked, and CVX opened gap up. The loss ended up around $250,000. The head guy ate the loss and eventually left Mosaic. It just sticks in my head how the most rudimentary errors with a pinch of bad luck can lead to a massive loss.

Hydra, then back to Mosaic / 2012–2016

PETE: Why did you leave Mosaic and join Hydra?

KNISH: It’s hard to believe it’s over something so basic but just charts. Mosaic was losing access to a licensed charting platform called Magic Charts and Hydra had acquired it. That was it.

PETE: Any good stories there?

KNISH: So they *allegedly* had a day on the razor’s edge while trading the Facebook IPO. I was still at Mosaic at the time, but friends there privately told me there was crazy risk being taken on. Too many young traders with no money down and a couple million in buying power going all-in at the same time. They were long millions of shares as a firm and traded around 10% of the volume that IPO day. They bought huge at the $42 open print, it immediately flashes down to $40 and then to $38 within minutes, and they were way underwater just on a 10% move. I think it did bounce for them to sell some off. They were using that big $38 bid1the underwriting price of the IPO as their out.

Imagine if the underwriters had pulled the large $38 bid for a second and it dropped another $2-3 at once???

When I got to Hydra later, let’s just say they had strict size limits on IPO days.

PETE: And why did you then go back to Mosaic? You seemed to like Hydra but spent less than 2 years there.

Mosaic came back to us and offered a 99% payout on top of a bottom of barrel commission rate, which felt like a no brainer. Hydra also gave us some technical spiel about stops needing to be adjusted for some temporary period.

PETE: Was that really a thing?

KNISH: I thought it was BS but unfortunately, I found out Mosaic had the same problem too. Their stops became practically unusable. They were delayed by about a hundred milliseconds, which led to horrible fills in fast-moving stocks. I’m talking about market stops. At Hydra, my recollection was that fills were within about five milliseconds of the trigger. A hundred milliseconds was a lifetime back then. It took Mosaic until almost the end of 2014 to fix it.

PETE: Because of these ineffective stops, you had to make a drastic change in your strategy.

KNISH: Yes. A friend and I transitioned into full-time swing trading which had started gradually in 2013. It was actually a good time to do it. We brought other people around us along for the ride, and it felt like we’d reached another level of trading. We got off to a hot start in the first quarter of 2014… it was great until it wasn’t. The market got completely unhinged for a little while and my portfolio endured constant whipsaw. I couldn’t get back to day trading because of the stops issue and I kept trying to force the swings in a brutal market. Late 2014 was the closest I came to quitting. My mind was in a mental prison. I craved more consistency than what the results were giving me.

PETE: When did things turn around?

KNISH: It took a bit to get mentally back on track. Once they fixed the stops issue, I got back into my old rapid scalping style. I would just try to be green every day no matter what. The volatility from August 2015 into early 2016 was nice.

PETE: What’s the worst loss you’ve ever had?

KNISH: For the longest time, I felt a lot of FOMO and anxiety–always worrying about what other people were trading, how they were performing. Here’s a story where that feeling got me into a really bad situation.

There was a veteran trader at Mosaic, Bates, who had all these obscure situational trades, and one was a VIX pairs trade: in contango he’d short VIX futures and short E-mini S&P futures (/ES) as a hedge, and go long both in backwardation. Basically a mean-reversion bet on VIX while staying hedged.2For those unfamiliar: The VIX measures how much volatility S&P 500 options are pricing in over the next 30 days. It usually rises when stocks fall and eases when stocks rally, but that inverse relationship isn’t a fixed ratio or a guaranteed hedge. Contango means later-dated VIX futures cost more than nearer-dated contracts—say, next month at 20 versus this month at 18. Backwardation is the reverse: nearer-dated futures cost more, often during a panic when immediate volatility is especially elevated. These describe the shape of the futures curve, not whether the VIX itself is rising or falling. He explained it a million times and I never fully got it, but he always printed money with it while I watched in awe with no position. So this time in June 2016, I had enough pain from being on the sidelines and I had to put on the trade myself.

This was right before the vote on Brexit. The market was treating it like a non-event–VIX was stuck around 17, not reflecting much uncertainty at all. My close friend Chipster at Mosaic got in it too. After the close we went to a poker game while the trade worked in the background. We had some drinks, no worries whatsoever.

Then they started counting the Brexit votes and VIX shot up and /ES fell sharply. Chipster and I just looked at each other and laughed nervously. Bit of a surprise for sure but we’re hedged right?

The sequence of what happened next was really quick, all of a sudden VIX accelerated but the /ES wasn’t going down that much. My unrealized PnL ballooned to something like 2-3x my previous worst day ever. Meanwhile, an argument escalates between a player and the host over something trivial. It became complete chaos and the game breaks up. Chipster goes outside on the balcony and gives me the “I cut it” gesture, signaling he got out for a loss.

I head home while still in full position. During that 20 minute commute, my unrealized PnL hits 10x my worst day. What I hadn’t considered was that when E-minis get locked limit down, that leg becomes freakin’ useless as a hedge while VIX explodes completely uncapped. I couldn’t think straight. While staring at my PnL all night, I literally prayed that I wouldn’t get auto-liquidated before /ES opens again.

We group-texted Bates, “WTF is going on?” Turns out he wasn’t even watching! He was reading a book in his den, down $250K! He’s just as surprised as we are and doesn’t give us any good answers.

Eventually the E-minis reopened, VIX tops out, and around 4:30 AM, I get out at a manageable loss. The trade would’ve worked eventually as everything stabilized but I couldn’t make it that far. I felt too much relief just in getting out at reasonable loss levels.

I came too close to blowing up and it haunted me… you play conservatively your whole career and one day of bad judgment can undo it all. I truly hated myself. After that I was done following anyone else’s ideas. In a way, it cured my FOMO–from now on, I stay in my lane.

PETE: Prop kind of attracts the biggest risk-takers because they know they’re risking the firm’s money rather than their own. What’s the biggest blowup you heard about in the prop world?

KNISH: The story I heard was that a top trader at (redacted) lost about $15 million on the day XIV melted down and quit. Even though he was still up something like $75 million lifetime, he didn’t want to trade from a hole every day until he made back the 15. My takeaway from that was that you can have an incredible career and still have one horrible day that makes you decide you’re finished.

Retail Trader, Hyperscalping / 2017+

PETE: So around 2017, even though technically still registered, you started to identify more as a retail trader. Why is that?

KNISH: After that incident, I just slowly phased out prop. A lot of factors went into it–I didn’t get value from collaborations and I stopped going to the office. The TVs are too loud. I still have PTSD from Maria Bartiromo’s shrieking voice whenever the market dips. Freezing room temperature and weird lighting. It just didn’t fit my life anymore. I wanted to stay home and trade my own money.

PETE: Speaking of retail commissions… this was around the time commission free trading became a thing. What strategies did you deploy on retail brokers?

KNISH: Truly zero was almost there but not yet. Robinhood started that and the bigger guys like Schwab and Fidelity lowered their rates to compete. I was doing what people on daytrader twitter now refer to as “hyperscalping” although I had been doing it for years already. I had discovered something before zero commission that was a precursor to what the hyperscalpers would eventually do.

Around 2016, I started finding it harder to get filled on the bid and offer in my direct access prop account. Say I was offering at $10—huge white print3(a white print is a between print between the bid/ask, often at subpenny decimal would go off at $9.9999, and I’d never get filled at $10. It felt like market makers were cutting ahead of you. There were even times when I had a hidden offer and saw prints go off above my price without getting a fill.

I started messing around with retail brokers. TD charged something like $10 a trade back then, but if you tried to pay $10, you could be the guy getting filled at $9.9999. Remember that pilot program where certain stocks traded in 5-cent increments? In my prop account, if I paid the $10.05 offer, I’d get filled at $10.05. On TD, I could get price improvement and fill at $10.025. That’s when the light bulb went off: if I traded in big enough blocks, the flat commission worked out cheaper than paying per share at prop—and I got better fills.

PETE: What is hyperscalping to you? It’s become such a popular meta-term in daytrading circles now.

To me, hyperscalping is just getting in and out rapidly and never letting a stock go against you. You’re just trying to fill better than you got in and capture the midpoint or a positive spread. You keep banging in and out until it moves your way. If you aggressively pay the offer on an in-play name and nothing happens, you eat the spread, take the loss, and maybe wait to try again. Each attempt tells you something: how strong the seller is, whether the buyer is still there, whether the stock responds when you actually participate. It’s like paying for information–you get it straight from the market itself. Being in and out all day gives you a feel that you don’t necessarily get from watching a chart. Zero commission trading made that style economically viable.

PETE: Could you actually move the stock?

KNISH: Yes. On a micro level, sometimes a trader could almost dictate the move, especially on certain in-play names. You’d pay aggressively, the stock would respond, and you’d see other activity follow. My friend at TD was taking out successive offer levels within a second or two. His interpretation was that an algo sensed a big buyer (from his rapid trigger orders) and lifted the stock accordingly, and he took advantage to get out higher immediately. The next day his account was restricted. He told me their trading desk had called it “toxic order flow”–they wanted more time between orders. They’d been monitoring this since going zero commission.

PETE: Did this happen to you eventually?

KNISH: No. I had a feeling the greediest traders were taking it too far and my friend getting shut down confirmed that. I started to discipline myself to wait just a little longer and to not blatantly manufacture the moves myself. I’m still scalping but I’m vigilant in not going too far with it.

PETE: How scalable was hyperscalping?

KNISH: It varies a lot, based on what any given stock can tolerate. My experience was that market orders filled better than limits, within reason. Each stock seemed to have a size that filled easily—5k, 10k, even 50k shares. Go over that and the execution could get terrible. Too much and it felt like your order got held up and then filled badly. That’s why you can’t separate the trade from the execution. The entry on your chart can look identical, but the trade you actually get is different solely because of the size.

PETE: Did you hear about the big crackdown in 2025?

KNISH: In July 2025, a lot of people from various hyperscalping enclaves were getting banned from TD/Schwab, from what I was hearing. Some without any warning. You can see some of it on twitter.

It reminded me of how casinos ban the card counters in blackjack: you think you’ve figured out how to beat the game, but the house decides they don’t want your action.

Final Thoughts

PETE: What do you think about the role of luck in one’s career?

KNISH: Timing is so crucial because markets go in cycles and it’s random which one you’re in when you start out. There was a Korean kid at MBC in the class before mine. He was consistent but he was only making $1-2k a month. He quit after about a year because that’s just not enough to live in NYC. I remember him leaving just before Bear Stearns collapsed, and I always thought he would have crushed that day and probably all of 2008. He had as much skill as anyone else who did end up crushing it. He’d done the work to become consistent, then quit right as markets got good. Maybe he’s still trading if he had that 2008 experience. There’s an element of luck and fate in all this. I think about landing at MBC rather than just flaming out after Stone Brothers. It all came down to one lucky conversation. I also think about Tuco4former partner of MBC and head trader, and the career arc he had.

PETE: Tuco was great. Rest in peace. Mentored all of us, chill dude to hang around. How was your relationship with him?

KNISH: It was complicated. We liked him but there were personality contrasts. We were low key and he was more outgoing, outspoken. He wanted us to speak up more and it was a big point of tension that led to some of my friends leaving. Later I ran into him at a mutual trader friend’s wedding, and he told me he’d left MBC5(this is probably around 2014-2015) to start his own fund. My impression from that conversation was that he was tired of discretionary trading in general. Hearing that he’d passed away in 2020 was shocking and sad. I thought he would have crushed the covid markets if he were around.

PETE: Anything else in my posts that hits close to home?

KNISH: The Bowling Green bench in your AAPL story. I almost died laughing because I’d sat on that bench so many times contemplating my life. I’m reading it thinking, “I know that bench. I’ve had that (bad) afternoon.”

It’s a universal feeling isn’t it?

PETE: You say you consider yourself pretty risk-averse for a trader, explain that?

KNISH: Loss aversion is still real, even with small money. Your line about being “addicted to forty-five-degree equity curves” describes me to a tee. I want the money to come in steadily, and even a small interruption can annoy me more than the actual dollar amount deserves. I often throw up my hands over a measly sum because it feels like a bad beat. A missed fill robbed me of what I should have rightfully made–“I should’ve got paid there!“

PETE: Do you worry about trading anymore? Good and bad trading cycles, drawdowns, etc.

KNISH: I don’t think I’m worried about anything trading-related anymore. I’ve become close to zen in that regard. I know I can squeeze money out of dead or bad periods, make more in good times, and handle everything in between. Whatever happens, happens. The times I’ve hated it were all times I was swing trading with my PnL constantly in flux. I’ve given that up and I went back to my roots–consistently winning every day with base hits and that keeps me pretty happy. Doesn’t matter how big or small the win is, as long as I’m winning.

PETE: Do you love markets? Do you like being in positions?

KNISH: I love the act of trading. Financial markets, I actually don’t care for. I think that will always hold me back, because I enjoy clicking the buttons but not getting more in-depth than that. I know what kind of involvement I want now. I don’t need trading to occupy every part of my life. Sure, swing trading has virtually unlimited scalability, but day trading gives you more autonomy over your life. At this point in my career, nothing is worth more. People say swing trading gives you more free time and less stress, but try doing it and going to Asia or Europe on a whim. Try managing positions during a market panic on spotty wifi with twelve-hour jet lag. If you check your positions even once on vacation, you’re now a slave to them. I’ve experienced that. My point of emphasis now is to contain the work to market hours and enjoy life outside of it.

PETE: How do you feel about some of the new-age retail quant strategies you see?6this was in reference to my Professor Boring post

KNISH: I’m skeptical of the guy trying to find the holy grail in an Excel sheet while competing with MIT-grad quants. My view is that most people are hopelessly outgunned, and if a holy grail exists, it exists for exceptional people. That’s my hunch, I can’t prove it. Poker solvers give me the same feeling: the game gets studied more deeply, the competition improves, and whatever edge you thought you had becomes harder to maintain. You have to be honest about who you’re competing against.

PETE: What do you think about the role of talent and hard work in the makings of a trader?

KNISH: I don’t think I have natural talent. I just threw an ungodly number of hours into trading. For something as complex as trading, that commonly cited 10,000 hour rule might only get you to basic competence. Here’s a summary of my trading career: 8 hours of screen time a day, no lunch breaks in 20 years. At one point, I avoided drinking water to cut down on bathroom trips and gave myself kidney stones. Talk about health for wealth. I’m about 40,000 hours in and still nowhere close to anything resembling mastery.

Talent is definitely a real thing. Some traders I’ve seen, they excel at everything: news, breakouts, mean reversion, imbalances, fundamentals. That’s not me and that’s okay. I see myself more of a specialist. I still work on other areas, but I try to remember what got me here: cultivating strengths and mitigating weaknesses. A man’s got to know his limitations.

I want to give a couple analogies: Look at Ichiro. One of the greatest contact hitters ever, but another hundred years of practice wouldn’t turn him into a power hitter like Barry Bonds. Then consider music–most of the great guitarists specialize in one genre like blues, rock, jazz, whatever. It takes a lifetime to master just that one genre. Mere mortals have to pick their spots.

PETE: Your advice to the traders out there?

KNISH: Stop trading for a bit when it’s not fun anymore. The market will still be here. We’ve been privileged, and a lot of people would love to trade places with us. That’s worth remembering when you’re sitting there furious over a few bucks.

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