While the title says “..Trade Options”, readers’ expectations to find various “strategies” to gain from Options Trading per se, will be in vain.
However, an even better strategy than the typical 60% Equities and 40% Bonds, for a long term objective of investment – wealth generation, is proposed by the author.
“Investors lose more from predictable behavioral investing errors than sub-optimal portfolio allocations”.
Essentially, the strategy is an inclusion of Options whose underlying Stock is part of the Portfolio.
Well and good – there are still two issues that require some solutions: (1) an “Optimal” or near optimal allocation of capital to assets of the investor’s choice (not the typical 60% Stocks & 40% Bonds), and (2) a “Fair-Value” price for the Option contract.
Solutions there are now, created with the entanglement of Human Nature aka Behavioural Economics aka “Herd Mentality”(especially in the stock market), and Reality (Nature), aka Quantum.
For (1) – Portfolio Optimisation is available at:
In Play Store:
https://lnkd.in/gXrfhniG
In App Store:
https://lnkd.in/g9XBfdKX
For (2) – “…the Order Book does not represent a propensity function, instead it is a sample of firm orders from a subset of market participants. Individual Buyers and Sellers will be willing to transact at a range of prices, which are not all revealed. “
While, one mechanism to arrive at a amenable price is to “…model the spread indirectly by assuming a certain perturbation size, ….an alternative is to include what amounts to a third party,…..” –
qOtimp…
a Quantum mediator which provides a Fair-Value price, whose propensity function can be represented as a delta function located at this price.
– excerpted and updated from source to be credited at an opportune time.
Options Pricing is available at:
In Play Store:
https://lnkd.in/gkVqK4F5
In App Store:
https://lnkd.in/gQahsbYB
Cheers 🥂
