Like navigating busy Southern California freeways, volatility option trading is path dependent: Whether one makes or loses money depends on the path taken from point A to point B – as well as what happens en route. As with the freeways, bypassing traffic and finding an optimal route can make a big difference. As a real world example, driving to downtown Los Angeles from Newport Beach can take anywhere from 45 minutes to four hours depending on the route and road conditions (such as, perhaps, unexpected construction). It’s a dynamic process, as volatility – or “traffic” – can create more volatility.
Category: Economics
The Day the Computers Betrayed Us
“What we can say is that when things work in new ways, they break in new ways,” Alexis Madrigal wrote in The Atlantic after a glitch waylaid the NASDAQ stock exchange for three hours in 2013, causing a panic.
Bill Gross Didn’t Short China
‘‘Woulda coulda shoulda,’’ he said. ‘‘Obviously I wish I’d shorted a bunch of shares but that’s the bane of the portfolio manager: never happy.”
Robots On Wall Street ?
As automation in financial services grows, computers and algorithms have taken on some of the traditional work of traders, clerks and financial advisers. Now, a host of startups that use artificial intelligence to write news stories and other reports have set their sights on writing work at banks and financial-service companies.
The Bloomberg Terminal : Inside The Esoteric Ecosystem That Keeps Finance Hooked
Even high culture has acknowledged its status. Last week the Smithsonian’s National Museum of American History started displaying the old Bloomberg keyboard of bond market legend Bill Gross as part of its “American Enterprise” exhibition.
For bankers, traders and money managers, these examples of the terminal’s ubiquity are entirely unsurprising, with many admitting a near-addiction. “I genuinely don’t know how I’d manage without the terminal,” says Matt Russell, a fund manager at M&G Investments in London. “It’s quite sad, really.”
Abnormal Capitalist 