Mindblown: a blog about philosophy.
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Strangle
A strangle trade is where you buy an Out-The-Money put whilst simultaneously buying an OUT-THE-Money call or vica-versa If you are short strangles, it is a strategy that profits when the stock stays between the short strikes as time passes, as well as any decreases in implied volatility. The short strangle is an undefined risk […]
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Long Straddle
The Setup Buy a call, strike price A Buy a put, strike price A Generally, the stock price will be at strike A A long straddle is the best of both worlds, since the call gives you the right to buy the stock at strike price A and the put gives you the right to […]
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Y-Z
Zomma Zomma is a third-order risk measure of the degree to which the gamma of an options contract is sensitive to changes in implied volatility. It is also referred to as ‘D-gamma/D-vol.’ Gamma itself is a second-order risk measure of an option’s sensitivity of its delta to changes in the underlying price.
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Fed Meeting Post-Mortem and Potential Midterm Election Fallout
Though Federal Reserve Chairman Jerome Powell was certainly hawkish last week, we don’t believe the terminal funds rate expectations should rise much further given the information available and we think long-end Treasury yields are in the process of peaking. Investors consider that a grid-locked government could be good for Treasuries. Higher Terminal Rate Doesn’t Mean […]
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FOMC Statement comparison
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FOMC ANALYSIS
The Federal Reserve looks set to deliver a fourth straight super-sized rate increase with Chair Jerome Powell repeating his resolute message on inflation and opening the door to a downshift — without necessarily pivoting yet. The Federal Open Market Committee is expected to raise rates by 75 basis points on Wednesday to a range of 3.75 to […]
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Dont be afraid of UK zombies
A hard winter is coming in Britain, not only for the living but also the undead. The spike in borrowing costs generated by the short-lived Truss government could very well accelerate a wave of liquidations among the country’s expanded population of zombie companies. The shakeout, while painful for those who lose jobs and see investments fail, […]
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SHORT DATED OPTIONS ARE KING
It happens in a flash: The S&P 500 turns on a dime, and piranha-like options traders pile into short-dated contracts in a dash to harvest a quick advantage. Tuesday reprised a pattern that has been visible for months. As the S&P 500 reversed a 1% gain in a violent session right before the Federal Reserve meeting, the turbulence fed […]
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SFRA Skew has been pummeled over the past month…
SFRA Skew has flattened over the past month due to heavy buying of wings via Call trees, Call 1×2’s, and the unwinding of long downside structures. It appears the market has had enough as a skew buyer emerged today with this trade: PAPER -45,000 SFRZ2 95.625/95.875 CS 1×2 (-1Leg/+2leg) @ 0 REF: 9540. Vol, in […]
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This week’s upcoming earnings reports
the most anticipated earnings this week
Got any book recommendations?