Manage episode 272440584 series 2426951
Jay Pestrichelli co-hosts this episode with Derek where they discuss the continued talk around Robinhood Traders buying deep out of the money options to force market makers to buy stock. Plus, they discuss the reported $4 Billion spent buy Softbank to purchase option positions in some tech names. How do market makers hedge and the challenges with short term deep out of the money call option buying? Plus, why they both hate and love the idea of covered calls.
Robinhood Option Traders buying cheap deep out of the money call options
Does call buying really force market makers to buy up a lot of shares?
Examining option delta and time decay on short term Tesla call options
How the market sometimes makes you pay a tuition as you acquire trading knowledge
One of the best trading books Market Wizards by Jack Schwager
Examining the reported Softbank option spread positions
Why covered calls sometimes are detrimental to a portfolio
How often the overall market is up more than 15% in a year historically
What does option delta mean?
How does an options delta factor into how a market maker hedges?
Mentioned in this Episode:
Derek Moore’s book Broken Pie Chart https://amzn.to/3iKpRcx
Jay Pestrichelli’s book Buy and Hedge https://amzn.to/2ZQcYGg
Derek Moore and Jay Pestrichelli White Paper on Concentrated Stock Hedging download here https://zegafinancial.com/products/concentrated-stock
Market Wizards by Jack Schwager https://amzn.to/2FUwGcI
Stock Market Wizards by Jack Schwager https://amzn.to/3cbnhK5
(New Book) Unknown Market Wizards by Jack Schwager https://amzn.to/3kuMuSB
Contact Derek www.razorwealth.com