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Perhaps, but my point is that while a CC and a short put are theoretically (mathematically) the same, market conditions can skew that relationship.

No, but if you're trying to get out in a fast bear market, you'll likely get out of the underlying with with less slippage and narrower spreads (percentage wise) than the option. You can then close out the call later if you wish during a less frantic time with the CC.

If you look at the P/L profile they are, but there are practical differences. First, a CC is two positions versus one with a short put, which means more commish, and more chance for slippage. Although this is balanced somewhat by the fact that the underlying is more liquid than the option...

Correct me if I'm wrong, but the bookie himself is not taking the other side, it's one of the bookies clients who would take the other side. If the bookie thinks he can't find a client to take the other side, then he may not want to take the inital bet in the first place. The bookie ideally...

There is nothing special about the number 1.618 to the financial markets.

But is the true efficient price ever knowable? Perhaps it's like the antiques market where the true price is only what someone is willing to pay for it.

Taleb agrees with this. He believes one should take no risk, and at the same time take tremendous risk. In other words, have most of your money in treasury securities, and at the same time have money in high risk/high reward positions.

I take that to mean that if you know all the probabilities, they will sum to 1. The problem is that most of the time, all the probabilities aren't knowable. Thus on an empirical level, his quote is bullshit.

"Uncertain fortune is thoroughly mastered by the equity of the calculation." - Blaise Pascal What the hell did he mean? That if you have a good enough equation, you can basically print money in the markets?

If indicator performance is random, then so will be returns generated by that indicator. Random returns could give you a net positive P/L curve or a negative one, you never know until after the fact. After the fact could give you a blowout year or a blowup year. Money management techniques...

The problem with this is that the timing of when markets change from trending to non-trending and vice versa is random. The market has been trending strongly for the past few weeks, but next week could just as easily be the start of a choppy market for a while, or could resume the trend the...

Imagine that, cause and effect at earnings anouncements seem to be random. Eugene Fama and Burton Malkiel are smiling about now.

Doesn't one need to determine the maximal Lyapunov exponent so that they can determine the cycle period? For example if you are using daily data and there is a cycle period of 100 days, then generally the lookback window for your calculations should be at least four periods, or 400 days of...

What is your basis on the underlying? Perhaps take your profit on the 35 strike and sell the 40 strike.

Even if you get the IV prediction right over the weekend, if you get the direction of the underlying wrong, you're probably not going to make any money. Having said that, you could be very speculative any buy an outright put or call. With less risk but more commish and slippage, you could...

Effectively it's not the same because liquidity and slippage is different with the equity position of the CC than the pure option position of the naked put.

That makes the axis a standard deviation of the relative ATM strike instead of a percentage. What new insight is supposed to be gained from it?

The smile structure through time has a shape similar to this graph:

So what is the "Hidden Reality" about options? That it is difficult to make money with them if you don't get the direction of the underlying right? That liquidity sucks for most equity options, and thus bid/ask spreads are too wide? That writers of options tend to blow up? etc...

Didn't you watch the Cramer video? Not only are they trying to flush out the thousands of retail traders, they're also trying to flush out other large players who have millions at stake on the other side of the trade. It's a very lucrative business, and most of the time legit.