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Actually, you are right about that. And I guess we need to break funds down into more categories. You are right that very large funds have no incentive to kill their golden egg. But I also don't believe they are necessarily buying convexity either. They are more often then not in the more...

More back to the topic of this thread. Here is an older article I found from Taleb on options that some of you will find interesting. http://www.fxtsp.com/education/fx-trader-interviews/834-interview-with-top-trader-nassim-nicholas-taleb.html

So sle, I should disclose that my thinking on these issues is heavily influenced by people such as Taleb. I will post something from him here to add it to the mix. I'm not saying he is right or wrong. Just that my views are influenced by his work...

Dude enough. It's embarrassing. Have some pride and walk away from ET like a man. The trading thing didn't work out. No need to go through a sexual identity crisis and get off talking to guys. Don't pull a Buffalo Bill on us.

Dude, you've already been outed. Enough with the charade. Nobody is buying it. If it makes you feel any better, you maybe a blown out male trader, but you're still a cunt in my book. Now go think happy thoughts. :)

The Worldco alumni is long and distinguished. :) Here some fun reading material you can show the kids. Ignore the video, it doesn't go with the article. http://antisocialmedia.net/ipo-probe-of-wall-street-ties-tony-bruan-to-investment-banks/

Long dated perhaps, most of the covered call community is front month. And yes, I do believe long dated calls are under priced as well although perhaps for different reasons then you. I believe long dated calls don't accurately reflect long term trends in risk assets especially in a world...

Maybe for a price taker but I highly doubt that is true for a MM. In fact, there have been countless studies, I believe the CBOE did a white paper, showing that OTM calls are perpetually under priced due to the preponderance of covered call sellers. It's also why the call skew in most indices...

Think of theta as a hypothetical. In a world where the stock stays frozen in place and doesn't move, that's where our furry little theta friend plays. Theta is an abstract. It has no material meaning to your end result. Even if you close your position tomorrow, it has no material effect.

Since you are the King, you go last. I'm going to paste newwurldmn's comments below as a warm up to mine. Here is the thing. When one analyzes data we tend to take data and put it into an isolation chamber. In economics we call this marginal analysis. What that means is we want to hold...

Once again, without understand statistics this comment is useless. First of all, when you describe population data like the above it tells us absolutely nothing about what we want to know specifically. For example, yes, many options are overpriced. In fact thousands of them are. Particularly...

OK, so I think we covered this topic on the post on synthetics. Obviously, no one lost money on the put. How did you know I was even long the put? I could simply said I was long the July 390 calls. When in fact I wasn't, it still would have been the same position. As to your comment I would...

My comment was not referring to the fair value pricing, but rather that a guy would lock up capital for 6 months to "potentially" make 21 cents on a spread. I understand his logic but it seems like an awful waste of opportunity cost. He basically has to sit on this thing forever to capture...

OK, I'm going to break down your points one at a time and go over this. This will hopefully be a good primer for others to learn. Alright let's start with options 101. The first thing you learn if you ever work for a market making firm or any option trading firm is the concept of put to call...

Did you seriously sell a leap credit spread for .21?

Surf, I'm aware of his trend programs. I've been following the guy for 10 years. What I'm saying is, he is NOT your typical trend follower in that he initiates trades whenever they signal. He is more like Soros. Soros is a fundamental trend follower in that he forms a macro idea and then...

Taleb argues that option tails are under priced because it's almost impossible to price the tails effectively. Anything extreme is hard to predict. And when he says they are under priced, he is not saying they are off by a few percent. It's usually in the magnitude of 100's of times that...

I know I kicked myself for not checking as well. There are some strange cats on this site.