Options market making advice

Discussion in 'Options' started by Dannyxl, May 27, 2014.

  1. SIUYA

    SIUYA

    For individual equity options (as opposed to Index)......

    The best way to do this is via SIM and stress testing as no book will give you the real experience.

    Test things such as;

    how options are affected by dividends (changes in size and ex div dates across expiries) and what happens to the risk of your book when say all your ITM call options are exercised/assigned and you are left with different risks.

    Also - maybe given the interest rate environment its worth understanding the big effect long and short rates have on stocks and the options.

    Understand the mechanisms of borrowing stock.
     
    #11     May 28, 2014
  2. Dannyxl

    Dannyxl

    Great info guys. New here to this community and really happy about how much every1s willing to help out.

    Cheers! :D
     
    #12     May 28, 2014