MARA

Discussion in 'Journals' started by wxytrader, Oct 27, 2024.

  1. VOLdemort

    VOLdemort


    M**** the bid is determined by stock mid and parity. Anyone here should be able to give you the price of the call if you have the price of the forward and put.
     
    #41     Jan 17, 2025
  2. The bid is determined by Black Scholes,IV,dte,underlying price,strike lol...and put prices are derived from call prices. I know because my spreadsheet calculates it. You will learn V, never give me an opening to plug my spreadsheet!
     
    #42     Jan 17, 2025
  3. VOLdemort

    VOLdemort


    No it isn't. It's P/C parity. lol it's not model-dependent.
     
    #43     Jan 17, 2025
  4. Screenshot_20250117-161757.png

    "Put-call parity is a fundamental principle in options trading that describes the relationship between the prices of put and call options. It states that the price of a call option implies a fair price for the corresponding put option, and vice versa."

    The price of the put is derived from the price of the call. The price of the call is calculated using the black-Scholes or other models.
     
    #44     Jan 17, 2025
  5. VOLdemort

    VOLdemort

    You're an idiot.

    BSM requires a vol-figure to solve for price or you supply a price and it will output implied vol. You can price a put (call) if you have the price of the call (put) and the price of the forward. No model needed. You can simply use the stock when very close to exp.

    We've had this idiotic argument where you ridiculed BSM bc you didn't understand why using no arbitrage parity to price the put in lieu of (formalism) pricing the put independently.

    You're a complete f*cking moron.
     
    #45     Jan 17, 2025
  6. How are you going to get the price of the call in the first place? Lol
     
    #46     Jan 17, 2025
  7. VOLdemort

    VOLdemort


    Where does the market get it?
     
    #47     Jan 17, 2025
  8. The only variable you need is the iv. The iterative method doesn't sound very efficient:

    How it's calculated

    1. Start with an initial guess for
      upload_2025-1-17_17-44-4.gif
      IVcap I cap V
    2. Use the option pricing model to calculate the theoretical price of the option
    3. Compare the theoretical price to the actual market price
    4. If the prices don't match, adjust the guess for
      upload_2025-1-17_17-44-4.gif
      IVcap I cap V
      and repeat the calculation
    5. Continue until the calculated price matches the market price
    6. The final guess for
      upload_2025-1-17_17-44-4.gif
      IVcap I cap V
      is the implied volatility
     
    #48     Jan 17, 2025
  9. VOLdemort

    VOLdemort

    Infant, you need the option price to arrive at an *implied* vol.
     
    #49     Jan 17, 2025
  10. And you need the implied volatility to arrive at an option price.
     
    #50     Jan 17, 2025