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kinggyppo
 

Registered: May 2006
Posts: 5855

 

06-28-12 03:43 AM


Quote from atticus:

Curious, in what way? I've not other than the vanilla vertical vs. the Euro-style KI/barriers.



to me the binary pricing strips out alot of unnecessary inputs, if you price a very short term option with a binary the results are quite similar, I was responding to cd's post regarding vol. It is just an input albeit a very important one. I think people get lost studying the greeks, so you end up spending gobs of time on the inputs, to me its what's the position, what's the trade.

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atticus
 

Registered: Mar 2007
Posts: 12701

 

06-28-12 04:16 AM


Quote from kinggyppo:

to me the binary pricing strips out alot of unnecessary inputs, if you price a very short term option with a binary the results are quite similar, I was responding to cd's post regarding vol. It is just an input albeit a very important one. I think people get lost studying the greeks, so you end up spending gobs of time on the inputs, to me its what's the position, what's the trade.



And the relation of payout to moneyness?

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kinggyppo
 

Registered: May 2006
Posts: 5855

 

06-28-12 04:35 AM


Quote from atticus:

And the relation of payout to moneyness?



not to go off topic but in the straddles thread falcon thought because
he had a winner on a long straddle, thought he had found the grail, he didn't understand his gain was simply due to an increase in vol/vega. I don't think alot of retail guys realize you can simply isolate vol thru a simple calculator. Its too bad binaries are either ponzi type click here firms or OTC with no real access to smaller players.

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cdcaveman
 

Registered: Aug 2011
Posts: 3529

 

06-28-12 05:24 AM

luck and randomness have so much to do with things its sick! thats why i always try to enable myself to have limited risk and unlimited reward through backspreads, and long vol trades...

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atticus
 

Registered: Mar 2007
Posts: 12701

 

07-14-12 01:01 AM

ok, been busy.

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