Matches for herbi*, 4182 total results Sorted by newest | relevance
Fri Feb 07 03:33:46 UTC 2014 <herbijudlestoids> there is no set in stone method to calculate the value of an option. there is the black scholes model which has its proponents and detractors. regardless of which model you use, there is a bunch of standard inputs called the greeks
Fri Feb 07 03:32:05 UTC 2014 <herbijudlestoids> the value of the option isnt dependent just on price
Fri Feb 07 03:31:52 UTC 2014 <herbijudlestoids> am i making sense?
Fri Feb 07 03:31:31 UTC 2014 <herbijudlestoids> IV==implied volatility
Fri Feb 07 03:31:18 UTC 2014 <herbijudlestoids> if BTCUSD stays at 750 for 2 weeks without budging and IV goes down then the value of the puts goes down and whoever short them profits
Fri Feb 07 03:30:42 UTC 2014 <herbijudlestoids> if BTCUSD goes to 1200 in 1s then IV will go up and the value of the puts will increase commensurately...when puts are fare OTM (out of the money) then their intrinsic value is mostly comprised of IV
Fri Feb 07 03:29:52 UTC 2014 <herbijudlestoids> the trade is a bet on IV being high and leveling off or going down, and that they wont get exercised (i.e. the price wont go below 500)
Fri Feb 07 03:29:22 UTC 2014 <herbijudlestoids> so the trader is shorting BTCUSD 500 puts
Fri Feb 07 03:27:40 UTC 2014 <herbijudlestoids> yea
Fri Feb 07 03:27:15 UTC 2014 <herbijudlestoids> no i think youre correct, but i dont know anything about it specifically
Fri Feb 07 03:26:25 UTC 2014 <herbijudlestoids> i doubt its possible to know
Fri Feb 07 03:25:50 UTC 2014 <herbijudlestoids> if there is no naked puts then they must have been written against something
Fri Feb 07 03:25:29 UTC 2014 <herbijudlestoids> well, someone obviously sold the puts to the buyer
Fri Feb 07 03:25:08 UTC 2014 <herbijudlestoids> nubbins`: buying puts tends to be more of a call on IV than anything else...term structure also plays a part in profit, take a look at the NYSE listed VXX ETF versus VIX for an example of what term structure being in contango can do to a rolling IV long
Fri Feb 07 03:24:16 UTC 2014 <sypher_> herbijudlestoids, thanks for the explanation, I'm trying to get my head around it
Fri Feb 07 03:24:00 UTC 2014 <herbijudlestoids> value of option includes delta, theta, vega etc
Fri Feb 07 03:23:51 UTC 2014 <benkay> herbijudlestoids: no naked shorts on MPEx.
Fri Feb 07 03:23:35 UTC 2014 <herbijudlestoids> if the price goes to 500 but IV when puts were purchased was at 50% and goes down to 20% then the puts might still be worthless
Fri Feb 07 03:23:07 UTC 2014 <herbijudlestoids> depends entirely on implied vol
Fri Feb 07 03:22:46 UTC 2014 <herbijudlestoids> maybe they hold 1000BTC on bitstamp and want to insure against the price going below 500