zero-sum game?

Discussion in 'Options' started by madeqx, Apr 20, 2006.

  1. The title of this thread and the first sentence of your original post ("Is the options-market really a zero-sum game") do not follow with what you wrote above.

    It is possible for options to be zero-sum AND that certain players are consistently profitable (or consistently unprofitable). Zero-sum refers to the sum of all players not each individual player.

    If you are asking is it possible that there is an inherent edge in the option markets because some players are ok with consistently losing in options positions that are hedging non-options positions then you should just ask that question (which has nothing to do with zero-sum).
     
    #11     Apr 20, 2006
  2. Remember it's a negative sum game when you include commissions.....if you trade with IB or elsewhere where there are very low commissions it's not so bad but if you pay $15 a pop like at optionsxpress it can be a big hit.
     
    #12     Apr 20, 2006
  3. madeqx

    madeqx

    Ok, I agree I might have formulated myself wrong. Point taken.

    Then I ask that question..
     
    #13     Apr 20, 2006
  4. MTE

    MTE

    They may not particularly care about their option trades, but I doubt they would just be throwing money around. If they can execute a hedge with an edge then I don't think they would fight it.
     
    #14     Apr 20, 2006
  5. I have no answer to that question and would really doubt if any person does.

    Consider that the opposite could also occur (someone takes losses in a non-derivative market that yields an edge in their related options trading)
     
    #15     Apr 20, 2006
  6. 80 pages?!:eek:
     
    #16     Apr 20, 2006
  7. I'm sure you can make it break the 100 page mark just by posting there again and stirring up the usual crowd.
     
    #17     Apr 20, 2006