thanks it has a few things about harvesting risk premia (what most of vol trading is) that i think people in this thread would find helpful.
Thanks. Alas my definition of keeping things simple does not extend to ignoring greeks, so I do keep a close eye on them.
Dispersion is still pretty popular, though marginally less so since 2008. However, most of my strategies have nothing to do with dispersion, not even in "quasi" form - i am playing various intra- and cross-asset risk prema, e.g. I can be putting on relative skew trades or relative term structures. Not really. The work is largely academic and mainly geared toward quantitative research. Most of my "models" are very ad hoc and tactical in nature, which is a much better approach in my view. I think to extend this analogy, to simply "drive" options you can easily trade just using break-evens. To be a race car driver (options market maker or a volatility arbitrageur), you have to understand the Greeks and dynamics of both prices and price inputs. To be an race car engineer, you need to read Gatherals book and many other books.
Because you can be short gamma and still be net long risk premium. You can have ratio spreads and be long gamma etc. Greeks define your instantaneous risk and also explain your instantaneous P&L. This is especially important if you are running a large options book where there are various risks at play and it's hard to define your exact position.