Search results

Why do you think this would happen? I may have misunderstood something.

It's not a strange concept. You just don't like the reality of the math. Options are a side bet. It's a zero sum game. You and Goldman don't both somehow win. They win exactly like a casino does. When Goldman Sachs sells you a covered call they will let you win most of the time because it...

Market makers can do naked shorting. I don't know the details of when they are allowed to do this but if they are doing a naked short to balance out the put option they sold you then borrow costs and borrow availability aren't an issue.

My statement about quants at Goldman was not meant to be general and apply to everything. Bottom line is that if you want to win you have to explore a lot of strategies and you *must* know what you can sell at or buy at to be profitable. You can't just go to Goldman and take whatever they are...

I never made the argument that it isn't possible to be profitable trading. lol. You are putting up a strawman argument. The OPs option strategy is not profitable *as he has stated it*. He hasn't even calculated the price he needs to sell his options at to be profitable and he is assuming the...

That is not true. I earn a full time income running my own quant algorithms. There are places in the market where banks, hedge funds and their math phds cannot trade efficiently. Once you understand how these firms work and what their challenges are then you know where to look for the places...

My argument does not apply to all trading. Not everything is efficiently priced. My argument only applies to market makers who offer options. The only way this covered call strategy will work is if you first calculate the value of that option and then find it mispriced. If the strategy...

Yes, that would be wrong. The leap is priced so the odds are not in your favor. Why is this question important?? Considering how underwater pension funds are they may very well do something like this. Please answer these questions: Do you understand that if you are not putting the...

I'm confused. A few weeks ago at bitcoin $20k you said it was a guaranteed short. It's at $24k now. What went wrong?

Here is the non-mathematical answer to your covered call fog. I'm fairly certain you are not ready to dive into the math since you have already made your mind up about the value of your strategy. But if you are willing to temporarily set your conclusions aside we could also take the...

So long as the work is in your field you need to find the opportunity that values what you do and is able to leverage it. Demonstrating that you found someone that can't find value in your work can work against you.

Between 2006 and 2007 mortgage backed securities began to fail because they were given to subprime borrows and their rates were adjusting higher. These BDC loans are already at high rates and below investment grade and the rates on them are rising. Why won't companies like FSK continue to lose...

Any thoughts on BDCs? FSK just posted a loss for 2022 Q2. This appears to be the first time since 2020 Q2. I suspected they may be hurting a bit with rising rates since most of their loans are variable rate and below investment grade. The stock prices of the BDCs don't seem to indicate much...

You want to diversify your overweight position. Good idea.

Correct. I was being overly brief. Thank you.

To do this correctly you need to know how much cash your broker requires you to have on hand to sell the put. This varies a lot depending on the put you are selling and can easily be many multiples of the amount you hope to gain on the trade. So the cash required to enter the trade is actually...

You can write software to do IOC (Immediate or Cancel) across the spread. This causes you to grab whatever hidden liquidity is there and then have your order cancelled. Your order won't go on the order book and you keep your intentions hidden. You can then repeat until you are filled. This...

Then go for it. lol. That was a joke. Please don't. Setting a limit price DOES NOT remove liquidity costs. Period. There is a reason firms make money as liquidity providers. They play the liquidity providing game far better than you will by simply using your broker's provided desktop...

Get contact info for recent investors. Call them. "I have some shares. Want a few more? Maybe someone in your office does? I can offer a slight discount to the price you just paid". I've done this before with private shares. It can work. If they don't know someone then one of the many...

That's the mark of a wise man. You don't tell others your trades and put them on the trail of your strategies. We all hit a liquidity wall at some point so we sure as heck don't want competition on our trades.