Risk reward sucks for options

[2rosy]

Well they used to trade options on the floor so I doubt people were doing the calculus in their heads...or utilizing the Greeks like they do today... But it's definitely all about the math...probably just had

You were given option sheets that provided theoretical prices for given volatility and underlying. The math was more arithmetic and squaring your position.

 

[punktrader]

Options are obviously different because of the dimensions.
Namely, theta.
tick tock tick tock.
What just happened??
tick tock tick tock.

You just have such an edge on the statistical mechanics of the universe that there are all these option mispricings you are exploiting lol.

Like I said, numeric performance art.

Why do you isolate options in your reasoning?

 

[cesfx]

Options are obviously different because of the dimensions.
Namely, theta.
tick tock tick tock.
What just happened??
tick tock tick tock.

You just have such an edge on the statistical mechanics of the universe that there are all these option mispricings you are exploiting lol.

Like I said, numeric performance art.

It probably is a sort of numeric performance art.

And as a punk fan, you are right not to waste your time trying to understand anything about the arts.

 

[ironchef]

Why do you isolate options in your reasoning? It could be an opinion on financial trading as a whole.
Options are just an alternative tool that offer a multi dimensional approach.

Even if you are not a complex vol expert, you can use them to play both side of direction, no side, or use them as an insurance, or as "no-stop loss tool (for a premium) on directional chart trading", or use them in a binary mode to bet on price by x time...
And you can take any side of all these combinations, debit or credit these premiums.

Options are obviously different because of the dimensions.
Namely, theta.
tick tock tick tock.
What just happened??
tick tock tick tock.

You just have such an edge on the statistical mechanics of the universe that there are all these option mispricings you are exploiting lol.

Like I said, numeric performance art.

Options are fascinating animals.

They not only have expirations, option prices within the chains for an underlying are all linked.

My question for you sir, is, if they are forced to be linked, can this linkage force mis-pricing?

Thanks.

 

[2rosy]

These guys trading options I think

eurodollar options. The guys yelling for markets are brokers. The guys with folded sheets in there hands and not saying much are MMs

 

[nitrene]

So wallstreetbets are actually on to something and are not entirely wrong in their crazy option plays, just that their portfolio allocation of 100% to one trade is misguided.

I believe they call this YOLOing. The amount of people on r/WSB who put a lot of their portfolio on 0TEs or weeklies is astounding. So many blow ups on r/WSB. I think for awhile after Bill Hwang lost billions he was their loss porn mascot.