Three years ago, James Cordier - head trader at OptionsSellers.com, became infamous after a "catastrophic loss event" thanks to a "rogue wave" in NatGas options markets.

While not on that scale, this latest 'rogue wave' in Natural Gas futures appears to have taken its first victim (at least publicly that is).

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The FT reports that a top-performing US hedge fund specialising in natural gas has suffered a large hit to its performance this month.

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As The FT reports it, according to a person familiar with the fund's performance, Miami-based Statar Capital, which manages $1.7bn in assets and is run by Ron Ozer, a former trader at Citadel and DE Shaw, made 'hefty gains' in the first 10 days of the month, only to get clubbed like a baby seal in the next week, leaving the fund down 7.7% for September.

While The FT says the exact reasons behind the loss were not immediately clear, one glance at the chart above suggests what may have happened (given that the relatively small retracement in the price of NatGas was enough to wipe out all the gains and more from the prior rally): the fund was exposed long (likely levered) to start the month, outperforming as NatGas prices rose (along with volatility). Then, around mid-month, we wonder if the fund ''doubled-down' on the trend, perhaps selling puts (high volatility and price trend higher is your friend), only to see volatility continue to explode higher and prices retrace hard.

Of course, there's no way to know, but this year to the end of August, Statar had gained slightly more than 5 per cent after fees, before this month’s volatility.

Statar has lost money in European natural gas but made money in US natural gas this year, said one person close to the firm. On occasion in recent months, it has bet that prices would fall, said a person familiar with its positioning.

The “exodus of risk capital from the commodity markets” has exacerbated temporary market mispricings, while producers increasingly want to hedge, Statar says on its website.

“This has provided the best opportunity set for natural gas trading in many years.”

Finally, one wonders if the extremely steep surge in Nattie in the last couple of days has anything to do with Statar unwinding some more positions?

We suspect Statar will not be the last fund to admit major losses through this period of chaos.