Background: I recently explained to an amateur trader (who happens to be a family member) about the basics of the bid-ask spread and how market makers make money from the spread. As an offhand remark, I mentioned that market making firms are probably the best traders, and mentioned Virtu Financial's disclosure of having only one losing day in 1,278 trading days between 2009-01-01 and 2014-02-28 (source: Form S-1/A, page 2). This made her visibly excited, and she asked me whether or not market making firms such as Citadel, Virtu, and Jane Street are publicly listed companies. Virtu Financial is publicly listed (NASDAQ: VIRT).
I have the feeling that I have done something irresponsible, as she is likely going to buy stock in Virtu Financial after this. She thinks: "if you can't beat them, join them", and she wants to "invest in the best trader". I seem to have accidentally given her an irresponsible stock tip.
As you may know, market making is a risky business. How should I explain the risks to an amateur trader in a situation described above? (I am thinking of using the case of Knight Capital Group as a cautionary tale).
Forgive me if this is more of a personal interaction question than a personal finance question; this is the first stock tip I have ever given in my life, and I don't know how I should explain the risks to a person who can only think of profits. It is just unfortunate that I know too many easily-excitable gambler-speculators who don't know that they are gambling.