1) Capital Efficient - Larger Potential Profit Buying options, the capital required will be at most the cost of the option contract, as owning an option can only go down to $0.  Because option contracts have a time component and strike component (unlike stocks), it means only option contracts will always be cheaper than owning shares. Selling options, the capital required will be based on Margin Requirements set by the regulators and potentially adjusted by the broker.  The main difference is that initial capital required to sell options is based on formulas trying to target a probabilistic move against the position and not based on the max value the shares could become.  This generally leads to about 1/5 the capital and potentially less if the account qualifies for Portfolio Margin. These lower capital requirements mean that options can have risk that is leveraged to the corresponding stock, meaning less capital is required to taking similar risks of buying stock ...

 Over the last week the S&P 500 and Crypto Markets lost almost 6% and 30% respectively.  But how did this compare to the market expectations? Bitcoin extreme / outlier move?  By looking at the Implied Volatility Indexes for S&P 500 and Bitcoin we can see how much the market expected these assets to move: %Change 6/17/22 6/10/22 Implied Vol (6/10/22) std 1std (68%) 2std (95%) 3std (99.7%) S&P 500 -5.79% $3,674.84 $3,900.86 27.75% -1.51 3.8% 7.7% 11.5% Bitcoin -29.25% $20,591.00 $29,103.00 79.80% -2.65 11.0% 22.1% 33.1% For the S&P 500, we can look at the VIX Index on 6/10/22 as 27.75%.  If used to measure the uncertainty for 1 week, this would correspond to 1 std move being 3.8%.  From 6/10/22 to 6/17/22 the S&P 500 moved down 5.8%, which corresponds to 1.5 standard deviation move.  Generally an outlier, or extreme move would be a 2 standard deviation move.  So even though there was a lot of hype about interest rate affecting the st...

The 2 Main Arguments for why Bitcoin is an innovation and an achievement in cryptography application: Peer 2 peer trust-less electronic cash system  -> permission-less money Internet Native Money -> non-sovereign issued I first heard about Bitcoin back in 2011, but unfortunately didn't buy any.  I still don't have any (I've traded listed options on BITO, but those were short term volatility trades for  maybe a future post to get into).  But I've always been fascinated with it.  Not just because "number go up".  So stripping away the aspect of price going up exponentially, why does it appeal? The 2 main appeals I can distill down to: Peer 2 peer trust-less electronic cash system  -> permission-less money This is amazing in that it has the potential to replace money transmission/payment systems without a intermediary like Visa, Mastercard, Paypal, etc. This why technologist love it, it is the promise of a new system that doesn't pay 3rd part...

With so much hype of bull markets (greed) and bear markets (fear), it can be very helpful to understand the context of crypto markets with an indicator.  For example, with Bitcoin at $29,700 is it a bull market or bear market?  If it was January 2021, with it being an all time high, you would say bull market.  But if it is June 2022, where it has been constantly going down from a high of $63,000 you would say it is a bear market.  Below are 2 types of indicators that can help provide more context. 1. Crypto Fear & Greed Index The Crypto Fear & Greed Index tries to quantify current emotional sentiment of Bitcoin and Crypto markets into a number between 0 and 100.  With 0 being Extreme Fear and 100 represents Extreme Greed.  Currently, we are near extreme fear.  In the above example with Bitcoin at $29,700 it was 88 in January 2021 and currently in June 2022 it is 10. The index is composed of multiple factors (25% Volatility, 25% Market Momentum/...