The FairPut Initiative

destriero said:
How long did your previous thread drone on until they beat it into your head that your shit would be arbed out of existence? Anyone with an undergrad finance course knows better.
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This is a nonsense argument.

Only if one does not try, then one can't make any error.
What I do is an evolutionary process: failures are possible and learning from failures is part of the process, that's simply Life in a nutshell.
 
thecoder said:
This is a nonsense argument.

Only if one does not try, then one can't make any error.
What I do is an evolutionary process: failures are possible and learning from failures is part of the process, that's simply Life in a nutshell.
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Jump off Half Dome. Let us know how it goes.

You do not know what you're doing.
 
thecoder said:
@guru at all: I just want to create a correct option pricing model where CALL and PUT have the same payout.
As said, I first tried it on the BSM, but failed miserably b/c that addition of mine to the BSM suddenly made arbitrage possible :-(

So, this now is my 2nd attempt to find a solution. This means BSM can't be used for this desired option feature/behavior.
The consequence is of course: I must find a new, independent option pricing model with that desired feature.
I'm working on it and I'm confident to come up soon with a better model than BSM.

It isn't that important for me whether the world will use my new model or not. I just want to create a mathematically correct option pricing model. History will decide about its success or failure: if it convinces the industry and the academics then the industry will abandon BSM and use that new pricing model. That's my simple plan.
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You cannot create a mathematically correct option pricing model. You're not listening to those who are actually trying to help you. Instead of growing and learning, you are being defensive.
 
interdim said:
You cannot create a mathematically correct option pricing model.
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Why not??? And who says that? Nobody told me yet, and I didn't expect to hear such an argument.
You're not listening to those who are actually trying to help you. Instead of growing and learning, you are being defensive.
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I appreciate constructive help, but IMHO so far I only heard just "forget it", "let it be" etc. kind of types of "help".
Btw, did you really mean "defensive" or should that perhaps be "offensive"? :-)
 
Since there is no objective way to determine an option's true value, how do you know if the call is overpriced, or the put is underpriced?
 
Pekelo said:
Since there is no objective way to determine an option's true value, how do you know if the call is overpriced, or the put is underpriced?
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Hi Pekelo, have you ever heard of mathematics, probability, and logic? :)
The pricing model must be consistent in itself, ie. IMO it can be verified with its own methods, so to say.
 
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