GAMBLING ON THE INEFFICIENCY OF THE OPTION FORMULA

Discussion in 'Options' started by Trading Education Buyer, Dec 16, 2016.

  1. ironchef

    ironchef

    So, what can we small $5K retail traders do?:banghead:
     
    #41     Dec 24, 2016
  2. southall

    southall

    Always money to be made if you can predict price levels often enough but get out quick for a small loss if wrong. Even with a small spread betting account. Ive done it often enough over the years.
     
    #42     Dec 24, 2016
  3. I don't think those inefficiency price ever showed in those bucket shop price streaming.

    If you are talking about predicting of market direction, this is completely different topic. I just want to let you know no one can do this (even institutional with ample resources) . If you can actually do this Consistently for long term, a straight Future trading will make you millionaires, if not billionaire.
     
    #43     Dec 25, 2016
  4. You can try, but likely your 5k will end up in your broker year end bonus or paid for the nice holiday trip of your bucket shop's owner.

    I would rather spend this 5k for my own holiday :)
     
    #44     Dec 25, 2016

  5. options are priced with much more complicated formulas that take into account 'black swans'. That's why the IV on the put-side is so fat. The option market is still efficient despite black swans. Taleb and others are wrong.
     
    #45     Dec 25, 2016
  6. destriero

    destriero


    I plugged that into my macro and it produced a null error. Can you respond with pseudocode, plez?

    Why did you short the call against your long futures in your options thread? What was the rationale for doing so? vol-edge? Alzheimers?

    Is this your casino?

     
    Last edited: Dec 25, 2016
    #46     Dec 25, 2016
    lawrence-lugar and monkeyjoe like this.
  7. It's good to see you are back. ;)
     
    #47     Dec 25, 2016
  8. indexes or commodities- Enron is the standard you should apply to equities-ande for every put writer that says they are happy to own the stock at that level -how happy were they in Feb2009 when they sold?
     
    #48     Dec 31, 2016
  9. That's brave- Taleb is wrong! However even in the so called meltdown of 2008/9 put sellers were not wiped out as they simply rolled when volatility permitted into the next months. I don't wish any trader bad luck but good luck has permitted a lot of bad traders to survive when doing such dumb strategies-like Karen the super trader
     
    #49     Dec 31, 2016
  10. ironchef

    ironchef

    What would be a smarter strategy may I ask?

    Best wishes and happy new year.
     
    #50     Dec 31, 2016