Market Measures - August 6, 2018 - The Expected Payoff of Trading Options

published 2 weeks ago by tastytrade, Inc.

A key component of an efficient market maintains that prices are so well founded that no strategy can create a long-term positive return. We can demonstrate this with the expected payoff formula: Expected Payoff = (x * p) – (y*[1-p]) where x i...

This is a fairly way this is a fairly complex this is a fairly complex segment should I go for a walk out. The human we can. This complex segment so good German after this one I'm ready all right the core tenant of an efficient market maintains that prices are so well founded that no strategy can create a long term positive return remember we just talked about efficient markets no wage this kind of thing so a quartet of an efficient market maintains the price are so offended that no strategy can create a long term positive return so how do we make money. We're gonna give you the formula formulas so this sequestered expected payoff of 0 this is pure efficiency case we price all out and I think everybody ...

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