There's an interesting passage in Michael Lewis' The Big Short, in which he describes how a couple of amateur wanna-be hedge-fund managers made their fortune by identifying (what they saw as) an anomaly in options pricing. Basically, they observed that companies suffering from cataclysmic events (ex: a serious SEC investigation into company leadership) tended to see their option prices drop by a significant amount, often by 30% or more.
On Market Reactions to Politics
On Market Reactions to Politics
On Market Reactions to Politics
There's an interesting passage in Michael Lewis' The Big Short, in which he describes how a couple of amateur wanna-be hedge-fund managers made their fortune by identifying (what they saw as) an anomaly in options pricing. Basically, they observed that companies suffering from cataclysmic events (ex: a serious SEC investigation into company leadership) tended to see their option prices drop by a significant amount, often by 30% or more.