Berkson’s Paradox
Why correlations breakdown in the presence of "range restriction"
Education
Moontower Blog
Our thinking on options, trading, investing.
Shorting In The Time Of ShitCos
A qualitative appreciation for the asymmetry of shorting
Understanding Edge
The foundation of all trading
Twitter Reminds Me Of The Trading Pits
Information games
Interview Questions A Market Maker Gave Me in 1999
A focus on basic probability
On Delta Hedging
The broad trade-offs when trying to isolate volatility bets
Structuring Directional Option Trades
Options allow us to express bets on the distribution of the underlying instead of just "will the stock go up or down?"
Distributional Edge vs Carry
The problem with buying "low" and selling "high"
A Former Market Maker’s Perception of PFOF
Payment for order flow, market segmentation, and returns to scale
How Options Confuse Directional Traders
How you can be right on direction and still wrong
Prices Are More Than Expectations
The difficulty of extracting what markets imply
Measurement Not Prediction
Seeing the present clearly
The ‘Volatility Is A Risk’ Strawman
Risk is more than a single measure
Snowflakes vs Lemmings
First principles or fast-follow?
How Much Extra Return Should You Demand For Illiquidity?
A market-based thought exercise for pricing the value of liquidity
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Options, volatility, and risk — written by traders, delivered when we publish.