Something is not right..

[frostengine]

You know Trump personally ? I don't. So unless you do, your opinion is just formed from the Media which is garbage... or Books which is also garbage when it comes to making an unbiased view.

Now you're going to say he said stuff that he's not doing and he does stuff that he didn't say... so... like every politician ever ?

I have no political preferences, but I've heard people giving valid reasons for the market to crash since 2010, each time with plenty of compelling reasons as to why "now is the time".

I'm not advocating there will be a crash... I'm not even advocating I disagree with the policies. I sort of view several of his policies as "necessary medicine" which will result in short term pain for long term gain.

What I am saying is I believe the market is not pricing the risk properly. I view substantial risks for significantly increased volatility yet the VIX is at multi year lows. That is the disconnect I see.

 

[Jones75]

You know Trump personally ? I don't. So unless you do, your opinion is just formed from the Media which is garbage... or Books which is also garbage when it comes to making an unbiased view.

I take issue with your off the cuff statement…I happen to read books, and as earlier posted, now on my third since x-mas, about Trump. They have been written by noted authors and journalists whom you seem to be confusing with Hollywood reporters or CNN.

If you take the time to research properly, your understanding of Trump and how he operates can only help in engineering good trades and worthy investments. Good luck…

 

[Tim Smith]

What I am saying is I believe the market is not pricing the risk properly. I view substantial risks for significantly increased volatility yet the VIX is at multi year lows. That is the disconnect I see.

Correctly or incorrectly, there is no risk for the market to price until he takes office and people get a feel for him (and he gets a feel for the reality of politics). The market has simply priced itself based on best guesses at the moment.

If you are so certain of the disconnect, then why not take advantage of the arbitrage opportunities !

 

[birzos]

It's very simple, the world is now full of caretakers which is about perfecting daily life. What they don't take in to account are 4/5/6sigma events which requires explorers to neutralize them.

So the vix is showing the perfection of caretaking, because no one is smart enough nor experienced enough to see extreme events before they happen, myself excluded. The main issue is that over the medium to long term caretaking is degenerative on an exponential decay.

Then when extreme sigma events occur the world looks for a solution temporarily, those solutions require rapid exploration, then they plug the hole and back to caretaking. Except they never really plug the hole.

Because when you bring a group of minds together they get to 95%, buy time, and the cycle repeats each time going further to the extreme of the normal distribution.

Now, I'm experienced in global 6sigma events so for me it's all very simple to understand, but everyone goes around believing they have the answer and are the top of the food chain, until they aren't. Which is why everyone under the sun who I haven't spoken to for years now wants to become friends again.

Which I find quite amusing, as you can instantly see that no one has the answer and are floating around looking for it, but doing it in a way to make sure their view is the final view so they don't have admit fault as the more people that believe their view of events the more it validates the answer, even if their answer is fundamentally wrong.

Finding extreme sigma events can't be taught in the short term, you either get to find out the hard way by experincing them first hand, most will blow up, or you trust the few explorers who know how they work, everything else is just noise.

The world is full of caretakers earning an income which is flowing very nicely to the top of the food chain, the elites, apparently the richest 8people now control the wealth of the poorest 3.6billion.

The vix is just showing that view on the world, if you're an explorer you have to wait until that view is broken. Very lucrative, 20% month lucrative, but then I designed exploratory signals over the the asset classes to show when the caretaking fails.

 

[Spectre2007]

I agree with the original poster, last night when assessing the situation had a similar feeling. So many are against the President Elect.. it's kinda ominous.

The problem can be illustrated in what happened to Soros, he bet that equities would take a hit, but in the middle of the night when futures were locked -90, someone stepped in... it was almost as if there is a market force out there goosing the common perception. That's why prices aren't going down, the system would collapse with 50% hit on equities.

 

[Tim Smith]

That's why prices aren't going down, the system would collapse with 50% hit on equities.

But it'll be ok because the great orange one will simply declare "I have a great team. A fantastic Team. They are all wonderful people. Together we will MAKE EQUITIES GREAT AGAIN !".

 

[newwurldmn]

But it'll be ok because the great orange one will simply declare "I have a great team. A fantastic Team. They are all wonderful people. Together we will MAKE EQUITIES GREAT AGAIN !".

"The makerts are biased against me."
"We will make the equities the greatest again!"

 

[Maverick74]

By most measures, it appears we are about to enter one of the most "uncertain" times in recent memory. Yet VIX/Option Premiums are near multi year lows...

Everyday we have a new tweet about a tariff (at some point the market needs to take this seriously). Plus we have major instability in Europe brewing...

One tweet could cause a massive world wide panic sending the markets plunging... seems the next 4-8 years I would expect volatility/option premium to be high, but the market hasn't caught up.. what am I overlooking?

Don't get me wrong, I am fine with the low prices, I think being a buyer of options right now might be a great play as you look 3 to 6 months out. Especially buying ratio straddles (3 long straddles 6 months out short 2 straddle/strangles 2 to 3 weeks out) to finance the long straddles.. Just trying to figure out what I am missing..

Your assessment is wrong. Vol is not cheap. It's expensive in two ways. One, stat vol is in the single digits. Which means over the last few months vol has been horribly over priced and the downward trend has been justified by the actual vol in the market place.

Two, the forward curve in vol is actually very steep. So if you want to buy vol out in the future, it's insanely expensive, especially again considering the single digit stat vol.

 

[Tim Smith]

@newwurldmn

Of course he'll probably also send in Jared Kushner as the Wall St envoy to broker a deal.

 

[vanzandt]

Ha. The VIX can change in the blink of an eye.