Placid Sound
@placidsound.bsky.social
I've been delving into options math since 2018; I thought there would be a reasonable way to extract market sentiment from options prices as an input for the asset allocation we do at an RIA I cofounded. Eager to share my perspectives on options investing.
Just read this from a paper from Clif Asness. Organizations aiming for a 5% real return are in a difficult position now. Traditional diversified portfolios of equities and bonds are not positioned to get you there. You need something different, less explored, to get to that target return.
July 9, 2025 at 5:40 PM
Just read this from a paper from Clif Asness. Organizations aiming for a 5% real return are in a difficult position now. Traditional diversified portfolios of equities and bonds are not positioned to get you there. You need something different, less explored, to get to that target return.
Learning to live on less has a double impact on your retirement savings. It increases your savings rate, helping you get to your retirement goal faster, but if you carry forward those learnings into retirement, it reduces what you need to save. Let's consider a simple example...
June 27, 2025 at 4:03 PM
Learning to live on less has a double impact on your retirement savings. It increases your savings rate, helping you get to your retirement goal faster, but if you carry forward those learnings into retirement, it reduces what you need to save. Let's consider a simple example...
Investor sentiment is negatively correlated with future returns. Market sentiment seems to have a regression to the mean tendency. If the market is bearish today, the chance that sentiment will improve in the next month is greater than the chance it will decline. How can you keep track of sentiment?
June 24, 2025 at 2:58 PM
Investor sentiment is negatively correlated with future returns. Market sentiment seems to have a regression to the mean tendency. If the market is bearish today, the chance that sentiment will improve in the next month is greater than the chance it will decline. How can you keep track of sentiment?
Reposted by Placid Sound
The Safest Investments for 2025: Low-Risk Options with High Returns
#Markets #Finance #PersonalFinance #News
#Markets #Finance #PersonalFinance #News
The Safest Investments for 2025: Low-Risk Options with High Returns
Explore the safest investments for 2025 to protect your wealth while achieving steady income and growth in uncertain times.
franknez.com
June 4, 2025 at 12:50 AM
The Safest Investments for 2025: Low-Risk Options with High Returns
#Markets #Finance #PersonalFinance #News
#Markets #Finance #PersonalFinance #News
Most recent options implied equity forecasts posted here. As usual, this is not investment advice. Interpretation of these figures is up to the individual investor. To receive these forecasts before they are posted on BSKY, signup for the newsletter at: www.placidsoundcapital.com/newsletter-s...
June 4, 2025 at 1:03 PM
Most recent options implied equity forecasts posted here. As usual, this is not investment advice. Interpretation of these figures is up to the individual investor. To receive these forecasts before they are posted on BSKY, signup for the newsletter at: www.placidsoundcapital.com/newsletter-s...
Had a fascinating conversation with Vivek from Volaris Capital last week. They run options strategies for high net worth individuals. A few takeaways from our discussion:
May 28, 2025 at 12:46 PM
Had a fascinating conversation with Vivek from Volaris Capital last week. They run options strategies for high net worth individuals. A few takeaways from our discussion:
I was looking at the fixed income positioning of the Amplify Endowment Management endowment portfolio. What to do about treasuries. Are yields going up or down in the next three months? I looked at the options market and suggested using options to gain exposure instead of taking long exposure.
May 9, 2025 at 4:20 PM
I was looking at the fixed income positioning of the Amplify Endowment Management endowment portfolio. What to do about treasuries. Are yields going up or down in the next three months? I looked at the options market and suggested using options to gain exposure instead of taking long exposure.
I will post the options-implied expected 3-month returns for a few key equity indices each month. I will send them out first via our newsletter, which you can sign up for at www.placidsoundcapital.com/newsletter-s.... The options-implied forecasts through July 31 2025 are posted below.
May 5, 2025 at 7:31 PM
I will post the options-implied expected 3-month returns for a few key equity indices each month. I will send them out first via our newsletter, which you can sign up for at www.placidsoundcapital.com/newsletter-s.... The options-implied forecasts through July 31 2025 are posted below.
Reposting the options implied market expected returns for major stock indices as calculated April 16. You can sign to received these options implied market expected returns each month at:
www.placidsoundcapital.com/newsletter-s...
www.placidsoundcapital.com/newsletter-s...
April 23, 2025 at 5:08 PM
Reposting the options implied market expected returns for major stock indices as calculated April 16. You can sign to received these options implied market expected returns each month at:
www.placidsoundcapital.com/newsletter-s...
www.placidsoundcapital.com/newsletter-s...
April 16, 2025 Options Implied Stock Index Expected Returns Through June 30, 2025:
April 17, 2025 at 5:27 PM
April 16, 2025 Options Implied Stock Index Expected Returns Through June 30, 2025:
Reason #3 Puts are Overpriced: Investor Psychology Favors Put Sellers
April 11, 2025 at 6:29 PM
Reason #3 Puts are Overpriced: Investor Psychology Favors Put Sellers
Reason #2 Puts Are Overpriced: Puts Are Insurance Products
April 9, 2025 at 2:58 PM
Reason #2 Puts Are Overpriced: Puts Are Insurance Products
Reason #1 Puts are Overpriced: Market Makers Balance Put-Call Parity
April 7, 2025 at 3:13 PM
Reason #1 Puts are Overpriced: Market Makers Balance Put-Call Parity
Im going to drop a few posts about why selling puts is a better money making strategy than selling calls or buying options. But for today, Im just going to start with some data.
March 31, 2025 at 2:55 PM
Im going to drop a few posts about why selling puts is a better money making strategy than selling calls or buying options. But for today, Im just going to start with some data.
Many investors often ignore an underutilized asset we all have: the collateral in our brokerage accounts. You can monetize this collateral for additional gains, albeit at greater risk. There are three ways to do this:
March 18, 2025 at 4:47 PM
Many investors often ignore an underutilized asset we all have: the collateral in our brokerage accounts. You can monetize this collateral for additional gains, albeit at greater risk. There are three ways to do this:
Options strategies can be quite complicated. I feel as though many times these strategies are built up over time - one day something fails so someone adds in a fail safe, or one day someone misses an opportunity so they add in a new trigger.
March 5, 2025 at 3:22 PM
Options strategies can be quite complicated. I feel as though many times these strategies are built up over time - one day something fails so someone adds in a fail safe, or one day someone misses an opportunity so they add in a new trigger.
Earnings season drives up options prices. As companies report earnings, their stock moves can be significant and unpredictable. This increases the demand for hedging products. And increased demand increases prices.
February 12, 2025 at 3:09 PM
Earnings season drives up options prices. As companies report earnings, their stock moves can be significant and unpredictable. This increases the demand for hedging products. And increased demand increases prices.
I was listening to Bloomberg TV the other day when someone said "Don't short a stock just because you think it is expensive." It is dangerous to short stocks unless you know what the impetus for the stock to fall is.
January 30, 2025 at 1:20 PM
I was listening to Bloomberg TV the other day when someone said "Don't short a stock just because you think it is expensive." It is dangerous to short stocks unless you know what the impetus for the stock to fall is.
I've been studying options for a while, and one question that comes quick to mind is "Will future volatility be higher when options prices are higher?" or "Will future losses of the underlying be higher when options prices are higher?"
January 22, 2025 at 4:29 PM
I've been studying options for a while, and one question that comes quick to mind is "Will future volatility be higher when options prices are higher?" or "Will future losses of the underlying be higher when options prices are higher?"
Another use of an #option in every day trading: let us assume you have a profitable trade that you want to realize the gains from, but doing so would categorize the gains as short term gains and would thus result in a higher tax burden.
January 21, 2025 at 9:16 PM
Another use of an #option in every day trading: let us assume you have a profitable trade that you want to realize the gains from, but doing so would categorize the gains as short term gains and would thus result in a higher tax burden.
I've consolidated my posts about #options investing into a single article for easy access:
www.linkedin.com/pulse/13-thi...
www.linkedin.com/pulse/13-thi...
13 Things About Options To Know Before You Begin Trading (And Before You Decide Options Are Scary)
I've been studying and trading options for about 7 years now. While a lot of my work has been on options pricing models (and no, I do not believe the Black Scholes model is the best we can do), I have...
www.linkedin.com
January 15, 2025 at 1:30 PM
I've consolidated my posts about #options investing into a single article for easy access:
www.linkedin.com/pulse/13-thi...
www.linkedin.com/pulse/13-thi...
As a follow up on using #options to replicate margin in a non-margin account, you should always check options prices before taking a margin loan in your account. The reason is that margin loan rates vary significantly and your brokerage may have high margin rates.
January 13, 2025 at 2:27 PM
As a follow up on using #options to replicate margin in a non-margin account, you should always check options prices before taking a margin loan in your account. The reason is that margin loan rates vary significantly and your brokerage may have high margin rates.
It is possible to use #options to replicate margin in a non-margin account. For example, an IRA or other retirement account that may not allow margin investing. Understanding options payout curves is critical for replicating margin investing.
January 9, 2025 at 2:24 PM
It is possible to use #options to replicate margin in a non-margin account. For example, an IRA or other retirement account that may not allow margin investing. Understanding options payout curves is critical for replicating margin investing.
No responses on the question I pose about why at-the-money puts and at-the-money calls are the same price when the expected payoff of the at-the-money call is higher. Ill pose my response anyway.
January 7, 2025 at 1:53 PM
No responses on the question I pose about why at-the-money puts and at-the-money calls are the same price when the expected payoff of the at-the-money call is higher. Ill pose my response anyway.
Back to #options, a follow up question to everyone on my post from yesterday. In a 0% interest rate environment, an at-the-money call and an at-the-money put have the same value. But if stocks normally go up, there would seem to be a higher expected value of a call than a put.
December 31, 2024 at 3:46 PM
Back to #options, a follow up question to everyone on my post from yesterday. In a 0% interest rate environment, an at-the-money call and an at-the-money put have the same value. But if stocks normally go up, there would seem to be a higher expected value of a call than a put.