Wide BAC CDS but low Ted spread

This is not different from trading any other securities for example Walmart stock. Outcomes are always some what depending on random events, but it doesn't mean that we don't trade Walmart.


Quote from Martinghoul:

I disagree... Suppose I give you a futures contract where the underlying for delivery is either: nothing, 1000 barrels of oil, 91 metric tons of rice or 100 troy ounces of gold. Which one of those the contract settles to is chosen at random. Let's say it's priced at arnd 466. Would you buy it or sell it? [/B]
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Quote from Cyrix:
This is not different from trading any other securities for example Walmart stock. Outcomes are always some what depending on random events, but it doesn't mean that we don't trade Walmart.
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I agree that the outcomes are always random to an extent. However, in the case of Walmart stock there's a reasonable expectation that the final return on your position is tied to Walmart performance (as defined by dividends, balance sheet, etc). In the case of a contract I have defined its fundamental value is random in an unquantifiable way. It's an "unknown unknown", so to speak, whereas the value of WMT is a "known unknown". See what I mean?
 
Quote from Martinghoul:

Suppose I give you a futures contract where the underlying for delivery is either: nothing, 1000 barrels of oil, 91 metric tons of rice or 100 troy ounces of gold. Which one of those the contract settles to is chosen at random. Let's say it's priced at arnd 466. Would you buy it or sell it?
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Exotics, Exotics - chooser -- hedge your deltas and play cross-gammas :) hahaha ...Good example Martin.
 
Quote from gmst:
Exotics, Exotics - chooser -- hedge your deltas and play cross-gammas :) hahaha ...Good example Martin.
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Haha, wasn't my intention to bring that sh1te in. Moreover, this one isn't even a chooser. I think I may have invented a new financial product :).
 
Quote from Martinghoul:

Haha, wasn't my intention to bring that sh1te in. Moreover, this one isn't even a chooser. I think I may have invented a new financial product :).
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yes, the random choosing makes it all the different. Not saying this product is going to be a hit one, but some of the best innovations have happened as a result of serendipity or mindless ramblings of learned men! :cool:
 
Ever since 2008 most have recovered. The only one that never really did was BAC. Always been shaky. I have a hard time believing they're not done.
 
Quote from athlonmank8:

420 bps...... Could be the end for them. Still tough to see how it's not
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The speed is so intense, I think people really want their money, there is zero trust. A case of how much will I get back is turning into, gimmie whatever you have right now.
 
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