Money Math

the arbitrage reflex is more profitable than the opinion reflex

A traditional way to think of a stock price is the expected value of its future prices weighted by their…

10 months ago

the art of paranoia

This is a fun one. A good friend and mentor from the pit sent me this (lightly edited and hyperlinked):…

10 months ago

the messiness of options in the real-world

Recently, I’ve been writing a lot about option funding — implied rates, reversal/conversions, and financing stock positions, and even a…

10 months ago

VIX futures vs VIX synthetic futures

Here’s an FYI that reinforces a lot of moontower 2025 writing on option synthetic futures. This is from my IBKR…

11 months ago

what hides in the option chain

We’ve been talking about option funding stuff recently in the paid Thursday issues. Recently, I had a trader ask for…

11 months ago

implying the cost of carry in options

This is the follow-up to last week’s the easiest win in options is for stock traders. In that post, we started…

11 months ago

the easiest win in options is for stock traders

Most people who get into options are seduced by levered returns, but for the relationship to go from a fling…

11 months ago

Learn put/call parity with this free game

Yet another vibe-code project. This one went viral because…it’s a game! It's a replica of the one we trained on…

12 months ago

shadow theta

Today is a continuation of calendar spreads through the eyes of a vol trader. Recap That post is a response to…

12 months ago

how I explained vol drag to a 12-year-old

I used a pattern to explain it to my 12-year-old on our car ride on Monday. Start with: 8*8 =…

12 months ago