American options are not vanilla
American options as "optimal stopping time" problems
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Moontower Blog
Our thinking on options, trading, investing.
“markets vs democracies” in the wild
votes vs money-weighted votes
Options on Levered ETFs (part 2)
Last week, in part 1, we backfilled prerequisite knowledge: 1. Distance in return space: equal percentage moves aren’t equal in compounded or log space 2. Vol bonus vs vol tax: trend and chop change the distribution of a levered asset 3. Derivatives-on-derivatives: options on the underlying ETF are inputs into pricing options on the levered ETF. 4. Vega convexity: OTM options have “vol gamma” or volga which makes their sensitivity or vol changes vary depending on the IV level. This is not t
Option on Levered ETFs (part 1)
“They” say human labor will be irrelevant by 2027. By then, any business you can think will be solved by capital (electricity and tokens) before you brush your teeth in the morning. You either get rich in the next year or join the permanent underclass. So we aren’t shocked that the hottest fads in investing is pure return fuel: * double, triple, even 5x levered ETFs * options (record volumes, with nearly 2/3 of SPX options in 0DTEs!) You’re not gonna break outta that underclass clipping 10
"trader" is a uselessly broad term
key differences between retail and institutional traders
the arbitrage reflex is more profitable than the opinion reflex
the "system 2" reaction to a proposition
the art of paranoia
stubborn assumptions die hard
deworsification?
proving diversification is a free lunch
Our newest feature: TRADE IDEAS
How parallel coordinates turn four volatility metrics into actionable trade structures
why poker is used to train traders
speedrunning feedback
Spooky? Jeff Yass on Prediction Markets
Jeff Yass on prediction markets
the messiness of options in the real-world
funding edge cases
vol trading is easier than directional trading
every industry has its challenges
VIX futures vs VIX synthetic futures
law of one price in action
what hides in the option chain
things to watch for in option chains
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